Trying EURAUD short here into the RBA meeting.
I think the RBA meeting is underpriced for a potential hike. AUD CPI rose last month and is sitting at 6.8% and we also had minimun wage increase news last week as well. Based on their last meeting the RBA seem to be quite focused on lowering inflation. Meanwhile EUR inflation seems to be falling and with EUR data coming in worse i think that EUR longs are a little stale now. We also had some china stimulus news last week and better china data which should help EURAUD move lower due to AUD benefitting more so than EUR from a potential china reopening.
rate differentials have moved much lower which should help.
sentiment and positioning were extremely high about 2 months or so ago and now appear to be falling.
Overall i think a hawkish RBA could lead to a decent move lower.
Not trading/investment advise, feedback welcome!
I think the RBA meeting is underpriced for a potential hike. AUD CPI rose last month and is sitting at 6.8% and we also had minimun wage increase news last week as well. Based on their last meeting the RBA seem to be quite focused on lowering inflation. Meanwhile EUR inflation seems to be falling and with EUR data coming in worse i think that EUR longs are a little stale now. We also had some china stimulus news last week and better china data which should help EURAUD move lower due to AUD benefitting more so than EUR from a potential china reopening.
rate differentials have moved much lower which should help.
sentiment and positioning were extremely high about 2 months or so ago and now appear to be falling.
Overall i think a hawkish RBA could lead to a decent move lower.
Not trading/investment advise, feedback welcome!
Comment:
exited the trade at 1.6015, the china exports data last night was worse than expected so i think this move is mostly done short term