Citi comments on the AUD/USD
- AUD may remain consolidation in the short term
Technical Analysis ...
- RSI: Oversold
- Lower lows
- Technical indicators suggest the AUD/USD may fall toward 0.7016-0.7141 gradually upon consolidation, with resistance at 0.7533
Citi further cite some fundamental factors:
- Commodities have sold-off broadly in the quarter to date
- Likely that the commodity sell-off has coincided with renewed dollar strength
- Though fundamental factors and financial outflows have also underpinned the move
- Commodity-linked ETFs and passive index investments have seen a total of c$3bn outflows QTD in contrast to c$22bn inflows in 1H'15
- Reducing its 0-3m point-price target for COMEX gold
- Reduced its 0-3m downside point-price target for LME copper
- Remains bearish on Grains and Petroleum prices
- "As industrial commodity prices plunged, commodity currencies such as AUD sold-off in driven by concerns that low commodity prices could hurt growth prospects and lead to dovish central bank intervention
- However, with much of the Australian event risk behind us, AUD may remain consolidation in the short term"