AUD/USD reverses to three-day low
The US dollar is the story today.
It reversed on a handful of fronts on Tuesday and it's doing the same on a handful more today.
One of them is AUD/USD. The pair hit a four-week high yesterday but it's fallen more than a full cent from the best levels of the day and is now at the worst levels since Friday.
Alone, AUD/USD is a particularly meaningful reversal but when coupled with the turnarounds in USD/JPY, EUR/USD, USD/CAD and others, it starts to paint a rosy picture for the dollar.
A big reason is Hurricane Harvey. At first the market sold the dollar on the thinking that it would keep the Fed on the sidelines. That makes sense but it was already largely priced in. Now, the thinking is that it will help Congress come together and pass the debt ceiling. That will leave more time and energy for the tax bill as well.
Of course, I hate to draw any conclusions before month end and we could just be seeing some dollar-short profit taking. So it's way too early to call a bottom in the dollar, but it's not to early to be thinking about one and the charts are starting to make a good argument.
