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theflasherman

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The Australian dollar - the best is behind it

 

Key points:

  • After doubling in value against the US dollar (US$) over the last decade, the best is likely over for the Australian dollar (A$).
  • The commodity price boom is starting to fade in response to a moderation in Chinese growth as commodity supply starts to increase. The impact of quantitative easing in the US is being blunted by rate cuts in Australia with the prospect of more to come, and the rise in the A$ has exposed the high cost base of the Australian economy.
  • While further gains are likely in the value of the A$ against the yen (to around ÃÆâ€â„¢ÃƒÆ’ƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ÂÂ¥110 by year end), the A$ is likely to remain range bound this year against the US$ with the risks on the downside, particularly over the next few years.
  • For Australian based investors, this means less need to hedge global exposures back to A$.

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Hi Nipper

WhatI like most in your key points is: "Afterdoubling in value against the US dollar (US$) over the last decade, the best islikely over for the Australian dollar (A$)."

 

I believe Just like gold next we will see sell off in the currency market especially most over valued currencies such as NZD and AUD.

 

My opinion on the currency market:

There was a time some wanted to touch EURO instead of USD. So they fell in love with EURO. Instead of falling love with it at least they should not have dumped USD to get EURO. There were other bull currencies such as NZD, AUD and CAD in addition to few Asian bull currencies. Now we have to see currency market in a different way.Sooner than later bull currencies such as NZD, AUD and CAD will become bear currencies. NZD will hit hard as one of the most overvalued currencies in the world.It can go down sharply. Now USD has become bull currency. We will see beginning of bull markets for few currencies including few Asian currencies. Few Asian currencies can appreciate sharply from 2014.

 

In short this is the time to become bullish on USD.Later we can become bullish on few more currencies. It is also time to stay away from AUD and NZD. This time Japanese investors and another top contrarianinvestor became bearish on AUD before others and they sold AUD and AUD related bonds before others. Recently Japanese investors dumped Australian debt at the fastest pace on record earlier this year. Suddenly market players including bear crowd all became bullish on USA and Japanese market. Some of these crowds not only became bullish on USA market but also on USD number one reservecurrency in the world.

 

In short AUD and NZD dollar has entered a multi-year bear cycle and the dollar (USD) has entered a multi-year bull cycle. Lower AUD and NZD will benefit export companies in Australasia in the coming years.

In short I am bearish on AUD, NZD and CAD.

 

My ideas are not a recommendation to either buy or sell any security or currency.Please do your own research prior to making any investment decisions

 

Please see following link:

http://seekingalpha.com/article/1359661-time-to-sell-the-australian-dollar

 

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In short AUD and NZD dollar has entered a multi-year bear cycle and the dollar (USD) has entered a multi-year bull cycle. Lower AUD and NZD will benefit export companies in Australasia in the coming years.

In short I am bearish on AUD, NZD and CAD.

 

A very big call making many fundamental assumptions, which if they come to pass spell trouble with a big T in the shorter term for our economy, the very first step has to be a lowering by .25% tomorrow of our rates plus more drops in the next 12 months, and just cannot see that happening with a change of Government here highly likely in the very near future.

 

Any change in political directions by the incoming government will probably boost the AUD--so any rate drops--IMO---wont happen until any new government has shown its true colours for many months--far too risky property price wise.

 

The AUD/USD has gone absolutely nowhere for the last 9 months---and will more than likely continue in this fashion--IMO.

post-20731-1367828912_thumb.jpg

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Soros is rumoured to be betting against the AUD.

http://www.abc.net.au/news/2013-05-07/doll...-of-rba/4673954

 

Nobody beats George. Its going down.

 

Yet when the shortcut is activated this is what it actually says:

-------------------------------------------------------------------------

 

A senior currency strategist says a half-cent dip in the Australian dollar since yesterday afternoon is unlikely to have much to do with rumours that billionaire investor George Soros is shorting the currency.

 

The Australian dollar fell from around 102.9 US cents when Australian markets wrapped up trade yesterday afternoon to a low around 102.2 overnight, before bouncing back to 102.5 US cents by 9:18am (AEST).

 

Rumours swirled around markets yesterday evening that billionaire US investor George Soros may have taken a $1 billion short position against the currency - Mr Soros famously profited from successfully shorting the British pound early in the 1990s, despite attempts by the Bank of England to prop the currency up.

 

However, the Commonwealth Bank's chief currency strategist, Richard Grace, says a billion dollars is actually small change compared to the size of the market for Australian dollars

 

etc etc etc

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someone leaked the action eh????

 

yeah, there is always that possibility, eb :sadsmiley02:

 

I'll have to give my mate a dressing-down. The least Georgie could've done was call me. It's a shielded line - no huhu! :P

 

maybe it wasn't him after all ...

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