Australian dollar

1

Australian dollar weakening on the crosses

Aligning yourself to the views and policies of central banks is a trade that has worked well for much of 2013 and for pure technical traders this view is merely reflected in the underlying trend anyhow. Technicals are clearly reflective of fundamental divergence among central banks right now, although bond yield spreads are also aiding

12

Still long the Australian dollar

AUD/USD hit a low yesterday of 0.9057, thus testing, but failing to trigger my proposed stop loss at 0.9040 and the trade idea has now moved back into positive territory. Good bids have come back into the AUD and we have seen a subsequent move back above the 91 handle. On the hourly chart we’ve even seen

5

Australian dollar bounce is due

Potential trade idea: buy AUD/USD at 0.9100, with a stop loss at 0.9040, and a profit target or 0.9220. The trend is lower in the pair, and while the MACDs are firmly below zero and the RSIs are still weak, I feel AUD/USD could be due a short covering rally this week. A look at the daily candle

12

Australian dollar breaks support

The currency is headed lower this afternoon after breaching its recent low at 90.6 cents: The capex report is so yesterday it seems. Hard to know if the Government’s dramatic swing towards protectionism is at fault as less foreign flows are an excuse to send the Aussie lower. I’m more inclined to the view that

11

The bitcoin rich list

Ah, the wonders of a virtual currency, which is still going parabolic, last night breaching $1200: And yes, there is a bitcoin rich list, so long as you’re happy with the designation R2D2: And damn, is it tightly held: The madness of man never ceases to astound. Much more at Bitcoin Rich List.  

3

Australian dollar five drivers still point down

Regular reader will recall that MB uses a “five drivers” model of Australian dollar valuation. Six weeks ago I described how they were turning bullish for the currency. A fortnight ago I described how that had reversed. Revisiting those drivers today and it’s a still weak picture: interest rate differentials; global and Australian growth (more recently this

0

Taper fades but so does Australian dollar

An interesting day in the US on Friday. Markets pulled back firmly from taper expectations with stocks advancing to record closes (Dow above 16,000, S&P above 1800), long bonds rallied firmly and yields pulled back from more than 1% to 2.85%, a little way below their recent breakout levels: Data was thin so some of

19

Everything I asked about Bitcoin

The econ-blogosphere has been Bitcoin crazy for a while now. I haven’t quite understood what all the fuss is about, and knowing the personalities involved in much of the hype, I was afraid to ask too many detailed questions. But I did anyway. I finally put together my views following Rabee Tourky’s post at Core

9

How to kill bitcoin

Cross-posted from Wolf Richter at Naked Capitalism. The Senate hearing on Monday was the culmination of a three-month investigation into virtual currencies, said committee chairman Sen. Tom Carper (D., Del.). “Virtual currencies, perhaps most notably bitcoin, have captured the imagination of some, struck fear among others, and confused the heck out of the rest of us, including

12

RBA misses Australian dollar again

While Ben Bernanke knows how to talk his currency into the ground, our own crop of central bankers have no idea. Guy Debelle appeared this arvo at a conference and, as usual, palavered all around the topic. From the SMH: Debelle says the Reserve Bank would “certainly” welcome moves by the US to return to

1

Australian dollar up as taper fades

The daily proposition that is the taper diminished  Friday as US data came in universally weak and risk was “awn”. The line-up included industrial production for October sliding: Industrial production edged down 0.1 percent in October after having increased 0.7 percent in September. Manufacturing production rose 0.3 percent in October for its third consecutive monthly gain.

1

China will weigh on the Australian dollar

According to the SMH: Forecasters are more divided on the outlook for Australia’s dollar than any other major currency as they weigh a boost from a recovery in China against a looming reduction in US monetary stimulus, a Bloomberg has found. The gap between the highest and lowest estimates for the Aussie through mid-2014 is the

12

Australian dollar spikes as ECB, FED print

Sigh, I did warn the RBA to hit the currency again. Instead, the ECB did, from the WSJ: The European Central Bank could adopt negative interest rates or purchase assets from banks if needed to lift inflation closer to its target, a top ECB official said, rebutting concerns that the central bank is running out of

42

Australian dollar thumped as taper surges

More taper chatter overnight, this time from noted Fed dove Dennis Lockhart. From Bloomie: LOCKHART SAYS TAPERING ‘COULD VERY WELL TAKE PLACE’ NEXT MONTH LOCKHART SAYS QE NOT MEANT TO BE ‘PERMANENT FIXTURE’ OF POLICY I don’t think so but who cares, the threat is enough. On the data front, it was pretty weak. The

1

Five drivers turning against Australian dollar?

Regular reader will recall that MB uses a “five drivers” model of Australian dollar valuation. One month ago I described how they were turning bullish for the currency. Revisiting those drivers today and it’s a weakening picture: interest rate differentials; global and Australian growth (more recently this has become more nuanced for the Aussie to

18

Colebatch: RBA must lower Australian dollar

  Australia’s best non-MB economic commentator, Tim Colebatch is today as eloquent as he right: There is something to be said for conventional wisdom. Since it is widely shared, a government can win support for sensible action by appealing to it. We can’t live beyond our means. Australia has to be a country that makes

2

The users guide to currency warring

Here’s one for the RBA from GS. A guide to the five points of currency warring: Watch for Sudden Policy Shifts – In a regime where stability is achieved via offsetting forces, a sudden change in one of these forces will lead to potentially rapid moves. Changes often result from a major policy shift, as for

42

Stop helping the RBA play dead on the dollar

Alan Kohler covers the right subject today but misses a huge opportunity: In essence the desperate fight against deflation in the United States, Europe and Japan as well as China’s incredible infrastructure spending, and now the expectation of reform there, are combining to keep Australia’s currency high. As a result, Australia’s currency is now the

20

RBA bashes Australian dollar in Washington

From the AFR: Reserve Bank of Australia deputy governor Guy Debelle has said that unintended victims of the US Federal Reserve’s unprecedented monetary policy stimulus have been told to “suck it up sunshine” because a stronger US economy benefits all nations. Speaking in Washington at an International Monetary Fund conference overnight, Dr Debelle appeared to

41

RBA/APRA double team hammers Australian dollar

Can we stop with the ‘central bankers are powerless’ line now? Glenn Stevens hammered the dollar lower yesterday with a blunt warning: Another part of the balanced growth path would involve an expansion in some of the trade-exposed sectors that have been squeezed by the high exchange rate. The foreign exchange market is perhaps another