NEWS / Foreign Exchange

AUD FLASH

Just thought I would quickly alert everyone to the risk in the AUD.

It is possible US GDP could surprise to the upside. Market is 1.8%. I think it will be 2.0%. If it is closer to 2.5% then the AUD support at .8225 could be broken and that could be significant.

I previously mentioned the possibility of a brief spike to .8170, let??™s say .8160, but there is also a slight chance of a move as low as .8070 before a few weeks consolidation then a fresh up-trend to .8650.

The favoured scenario is .8225 or .8160 holding for a run at .8650.

The risk scenario is a deeper quantum of correction consolidation to .8070.

If the market gets below .8100, it will do so because a lot of people are getting short, but exporters shoud buy the AUD down there if gets there in the .8100 .8070 area. If there is a need to buy some should be done here and at .8175. If we recover .8315 then the market has already bottomed and is on its way higher.

Please see chart below for the immediate significance of .8225.