AUD Archives - Page 2 of 2 - the patient investor

September 8, 2011

Aussie Dollar weakens

The Aussie Dollar is testing support at $1.045 against the greenback; failure would warn of another down-swing to parity*. Breakout above $1.075, however, would re-visit $1.10.

AUDUSD

* Target calculation: 1.05 – ( 1.10 – 1.05 ) = 1.00

AUDUSD is strongly influenced by commodity prices and closely tracks the CRB Commodities Index. $CRB is rising and breakout above 350 would indicate a primary advance to 385* — suggesting increased support for the Aussie Dollar.

CRB Commodities Index

* Target calculation: 350 + ( 350 – 315 ) = 385

September 5, 2011

Fighting Australia’s “hot money” problem – macrobusiness.com.au

Australia is a large net borrower from the rest of the world. A large deficit in a capital account along with a deficit in the balance of trade while the currency is rising are all strong evidence that Australia has a problem with currency speculation.

Currency speculation, sometimes called “hot money” , needs to be controlled because it can cause some serious imbalances in the local economy both on the way in, and on the way out. There are a number of well-known symptoms for hot money in-flows, these include:

• Asset bubbles

• Currency appreciation

• Inflation

via Fighting Australia’s “hot money” problem – macrobusiness.com.au.

September 1, 2011

Aussie stronger

The Aussie Dollar followed commodities higher, breaking through $1.06 to signal a test of resistance at $1.10. 63-Day Momentum holding above zero suggests continuation of the up-trend. In the long term, breakout above $1.10 would offer a target of $1.20* — though this is only likely if we see more quantitative easing from the Fed.

AUDUSD

* Target calculation: 1.10 + ( 1.10 – 1.00 ) = 1.20

The Aussie Dollar is testing the upper trend channel against its Kiwi counterpart; breakout would warn that the down-trend is weakening. Reversal below $1.245 would warn of a test of the lower trend channel.

AUDNZD

* Target calculation: 1.24 – ( 1.28 – 1.24 ) = 1.20

August 25, 2011

Aussie weaker

The Aussie Dollar continues to consolidate between $1.03 and $1.06 against the greenback. Failure of support at $1.03 would test parity, while breakout above $1.06 would target resistance at $1.10. In the long term, declining commodity prices are likely to drag the Aussie lower — unless the Fed starts printing money again.

Australian Dollar AUDUSD

* Target calculation: 1.03 – ( 1.06 – 1.03 ) = 1.00

The Aussie Dollar is testing the upper border of the declining trend channel against its Kiwi counterpart. Reversal below short-term support at $1.255 would indicate respect of the upper channel and a down-swing to around $1.20*. Breakout above $1.28 is unlikely but would warn that the down-trend is weakening.

New Zealand Dollar NZDUSD

* Target calculation: 1.24 – ( 1.28 – 1.24 ) = 1.20