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Goldman Updates On AUDUSD (And Sells The Pair)
From Goldman's Daniel Ryan:
With both Labor and the Coalition now tied on 73 seats (short of the 76 required for a majority), both parties will now begin negations to form a minority government. In light of the weekends developments, AUDUSD opened around the .8850 mark in Wellington, some 1pcnt from the NY close. Since however, there has been a very orderly recovery of those losses to open around the .8910 mark in London.
As outlined recently, my sense is that whilst the current political uncertainty is likely to offer a headwind to the AUD, it is the prospects for global and domestic growth which will reaffirm themselves as the primary drivers in the weeks ahead. I retain my bias for buying AUDUSD dips and hold core longs, and from here I would advocate buying weakness towards the 100dma (.8839). I note with interest the fact that AUDUSD has tested the critical .8840 - .8860 band of support three times in the last week without success, which encourages me to believe the path of least resistance is now higher.
Since the Wellington open we have been better sellers of AUDUSD on behalf of the franchise, though volumes have been modest. My sense is that for now, a 'sell-on-rally' approach will persist from the Spec community, however should a close above the .8975 mark develop, an unpleasant round of short-covering may then ensue. In terms of domestic data-flow, this week offers only some more peripheral numbers, with the next major point of interest being the Retail Sales report on 31.08 - this will be an especially important data-point given the RBA's recent focus on 'trends in household behaviour'.
Levels of note - Support - .8839 (100dma), .8796 (55dma), .8737 (22.7 low) - Resistance - .8973 (10dma), .9019 (19.8 high), .9060 (18.8 high)
Good luck
AUDUSD - three tests of the pivotal .8840 - .8860 band of support, have all been unsuccessful in the last week of trading
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In 2008 the Australian dollar joined company with the Polish zloty, and the Mexican peso as a currency that lost more than 30 percent in value against the U.S dollar. A housing crisis there, combined with a slowdown in China may cause a much sharper slump. Australia’s main stock index is represented in the NYSE through an ETF, EWA. Almost 50% of the index is financial and housing related stocks, which means that in crash scenario such as the one that is approaching a large portion of those companies may perform like the banks in United States performed during 2008. The other half is commodity related companies that will suffer from a recession in China and tighter lending standers of the Australian banks due to capital losses that they will surely face once housing turns south.
Australia’s Housing Bubble- Past the Point of No Return
I love the smell of a Goldman Update in the morning.
http://www.youtube.com/watch?v=bPXVGQnJm0w
Australia is about as far away as you can get. I like that.
http://www.businessinsider.com/chinas-hot-bestseller-the-goldman-sachs-c...
China's Hot New Bestseller: "The Goldman Sachs Conspiracy"Yesterday I bought a copy of Li Delin’s (???) latest book-“????” (Goldman Sachs Conspiracy). Li is a well-known financial journalist and author who has written several other books, including the November 2009 “??????——????????? (Eliminate All Competitors–How Goldman Sachs Wins Over the World”. You can read Li’s blog (in Chinese) on Caijing here.
According to the promotional sleeve around “????” (Goldman Sachs Conspiracy), the book has sold 100,000 copies since its June 1 publication; that counts as a bestseller in China.
In just a brief skim through the book I can tell it is ugly, driven by not just all the expected conspiracy theories, including an undercurrent of anti-Semitism, but also by a provocative nationalist theme. The first chapter, which declares that Goldman’s “ultimate goal is hunting and killing China”-sets the stage. In a possible, but failed, attempt to outdo Matt Taibbi and his vampire squid, Chapter 1 concludes in part with the author saying the company “has the IQ of an Israeli Shar Pei Dog and the cruel nature of a Manchurian Tiger (????????????????????..” To Taibbi’s credit, the book’s cover does refer to Goldman as “bloodsucking”.
I have written about Goldman in China previously here and here. Goldman may be taking a PR battering in China (the 21st Century Business Herald has a story today on a developer suing Goldman for “cheating him”), but it got the mandate for the Agricultural Bank of China IPO, the company made 200x or so on paper in their 2007 investment in Hepalink, and it still generates decent business in the country. Probably the clearest sign that Goldman is in trouble in China would be if it can no longer hire or retain children of some of the more influential people here. So far that does not seem to be an issue. So far.
The goldman financial system is unsustainable. It's squarely under the category of a psycopathic problem with long term achievable goals. Unfortunately it provides enough power to them to make them believe that elimination of everything honest about the system and stark refusal to give up the system no matter how terrible it is, no matter how much pain it causes or no matter what dreadful unthinkable acts are necessary to maintain it. They will create super criminal world full of super predatory psychopaths. They will eat all the surviving cattle and then turn on each other.
I should be a buyer? Charge it, MasterCard?
[OT]And in today's most ridiculous news about local governemnts trying to cover their debt http://www.readwriteweb.com/archives/philadelphia_wants_300_business_license_from_blogg.php[/OT]
Page not found.
Someone was subjected to extreme ridicule me thinks.
gap n' crap, bitchez
New lows for the move in the Eurodown to 6.50. It looks so grim, I have to buy.
Updated S&P500 chart:
http://stockmarket618.wordpress.com
In the excerpt, it doesn't say that Goldman is selling the pair. How does one arrive at that conclusion?
Thanks for such a great post and the review, I am totally impressed! Keep stuff like this coming!...
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