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19 Aug 2013
AUD/USD short specs reduced, vulnerable to massive rally above 0.9350?
FXstreet.com (Barcelona) - Having closed Friday session near weekly highs at 0.9181 after topside failure at 0.9215, the AUD/USD is off to a decent start on Monday Asia, with the price virtually unaltered, after detected bullish indications detected and previously reported in depth on August 5th and August 15th.
In the first report, it was highlighted that one of the immediate perils for Aussie sellers was the mounting evidence the trade was becoming too crowded by the specs community, suggesting signs for a potential reversal. After last Friday's CFTC futures positioning report, it was confirmed that the net short position has started to roll back as sellers run to the exits.
According to Greg McKenna, CEO at GlobalFX, "Even though positioning is off the all time high above 76,000 short last week at -62,721 the market is still mega short the Aussie with a net position that until a few weeks ago would have been unprecedented."
McKenna sees the market "very vulnerable if the 0.9350 region gives way to a massive rally." However, McKenna reminds us "we need a catalyst for wholesale liquidation as large positions can persist for a while just like they did with longs over the last couple of years."
In the first report, it was highlighted that one of the immediate perils for Aussie sellers was the mounting evidence the trade was becoming too crowded by the specs community, suggesting signs for a potential reversal. After last Friday's CFTC futures positioning report, it was confirmed that the net short position has started to roll back as sellers run to the exits.
According to Greg McKenna, CEO at GlobalFX, "Even though positioning is off the all time high above 76,000 short last week at -62,721 the market is still mega short the Aussie with a net position that until a few weeks ago would have been unprecedented."
McKenna sees the market "very vulnerable if the 0.9350 region gives way to a massive rally." However, McKenna reminds us "we need a catalyst for wholesale liquidation as large positions can persist for a while just like they did with longs over the last couple of years."