27 Jun 2013
Flash: AUD/USD looks to be fair valued – Westpac
FXstreet.com (New York) - According to Global FX Strategist Sean Callow at Westpac, “The AUD looks set to enjoy a little more short-covering but not much beyond 0.9400/50.”
AUD/USD at fair value?
“We are probably not alone in regarding AUD/USD around 0.92 as close to fair value. This does not preclude a fresh selloff if US data continues to surprise on the strong side. However, nerves over China are settling somewhat given the PBoC’s assertion that the money market rate squeeze is temporary and partly seasonal, which helps the AUD mood.” Callow adds.
Domestically, local data should be mixed, nothing alarming and a steady RBA might help AUD a little on the day. IMM non-commercial AUD positions were very close to record net shorts last week. Profits should be taken on some of these shorts near-term, allowing AUD/USD to mark out a higher range on the week. Trade much above 0.9400/50 seems unlikely for now though. We are long AUD/JPY from 90.27 and inclined to pull up the stop to square.
AUD/USD at fair value?
“We are probably not alone in regarding AUD/USD around 0.92 as close to fair value. This does not preclude a fresh selloff if US data continues to surprise on the strong side. However, nerves over China are settling somewhat given the PBoC’s assertion that the money market rate squeeze is temporary and partly seasonal, which helps the AUD mood.” Callow adds.
Domestically, local data should be mixed, nothing alarming and a steady RBA might help AUD a little on the day. IMM non-commercial AUD positions were very close to record net shorts last week. Profits should be taken on some of these shorts near-term, allowing AUD/USD to mark out a higher range on the week. Trade much above 0.9400/50 seems unlikely for now though. We are long AUD/JPY from 90.27 and inclined to pull up the stop to square.