Yet again we’re bumping up against the 1.1800 level and reports are that some aggressive buying was the cause earlier for the sharp drop in AUD/USD from 1.0500 over the last hour or so. Buy stops are primed for a break of 1.1810/15
If it is fund related, which i half suspect, it could just be the start of some larger unwinding from them. Then this move could finally break up through the next significant level around 1.1856 (Jul 27 highs) and 1.1900 and it would point to a reasonable base formed down at the 1.1600/10 level.
Recent comments from ex RBA board member McKibbin calling for some RBA intervention to counter the AUD strength which is having a negative impact on Australian manifacturing are likely to be ignored, but some bearish rhetoric is likely from the RBA and if EUR/AUD does begin to get a up a ‘head of steam’ I’m sure they’ll be delighted.
AUD/USD bids from sovereigns and real money remain in the 1.0450/60 window with sell stops below down through 1.0445. On the flip side there are some decent offers from a myriad of names up from 1.0500/10 and again from 1.0530 to 1.0550.
