MUFG Bank Analysts They recommend the idea of a long AUD / USD trade that reflects their expectation of a weaker US dollar in the short term. They see a potential entry level at 0.7435 with a target at 0.7675 and a stop loss at 0.7225.
Key statements
“The USD has broken below key support levels over the past week, prompting an accelerated selloff. Historically, the USD has also tended to underperform in December. The weaker-than-expected November US employment report will increase pressure on the Fed and Congress to ease policy further by the end of the year. “
“Improving global growth prospects, driven by China’s cyclical recovery, has contributed to higher commodity prices and is expected to continue. However, we do not believe that the improvement in Australia’s terms of trade is fully reflected in the value of the AUD yet. It leaves room for the AUD to keep rising. “
“The next key resistance level for AUD / USD is at the 0.7500 level. A decisive break above would establish a new higher trading range between 0.7500 and 0.8000 “.
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