18 Feb 2014
Heavy buying in AUD as RBA refrains from talking the currency down...
FXStreet (Bali) - AUD/USD has entered an important resistance area following the RBA minutes, in which further evidence of the Central Bank's acceptance over the present level of the Australian Dollar resulted in a major spike in prices.
The AUD/USD initially traded as low as 0.9010 post RBA release, however, it only took 2m for HFTs, leveraged accounts and some macro accounts to turn the bearish tide around, as they digested the report, in which the 'neutral' views by the RBA were cemented while adding that 'lower AUD if sustained would be expansionary for the economy'. This latter line omitting any reference to a 'too high AUD exchange rate' turned to be the straw breaking the camel's back to bet for shorts.
As noted earlier by Nial O'Connor from JP Morgan Securities, a breakout of 0.9078/90 will be key to upgrade the AUD technicals, for a potential test of 0.9150/60, next hurdle to the upside should last month's high be cleared.
The AUD/USD initially traded as low as 0.9010 post RBA release, however, it only took 2m for HFTs, leveraged accounts and some macro accounts to turn the bearish tide around, as they digested the report, in which the 'neutral' views by the RBA were cemented while adding that 'lower AUD if sustained would be expansionary for the economy'. This latter line omitting any reference to a 'too high AUD exchange rate' turned to be the straw breaking the camel's back to bet for shorts.
As noted earlier by Nial O'Connor from JP Morgan Securities, a breakout of 0.9078/90 will be key to upgrade the AUD technicals, for a potential test of 0.9150/60, next hurdle to the upside should last month's high be cleared.