Barclays trade of the week: Sell AUD/NZD

New Zealand elections coming up

Currency investors should consider selling AUD/NZD this week ahead of NZ General Elections, advises Barclays Capital FX Strategy Research in its weekly FX pick.

"Short AUDNZD spot to express the view that recent election concerns and NZD depreciation appear excessive and unjustified.

We think that recent election concerns and NZD depreciation are excessive. Neither New Zealand's relative cyclical position nor its monetary policy stance supports the recent NZD weakness versus the AUD, in our view, and we recommend fading the recent move higher in AUD/NZD spot," Barclays argues.

The last 'trade of the week' we had was from Citi. They said to buy cable at 1.2948 with a stop at 1.2880.

What happened? It fell to 1.2850 two days later to stop it out... then promptly rallied to 1.3200.

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