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12 Aug 2013
Flash: Domestic events to trigger AUD/USD short-squeeze?
FXstreet.com (New York) - The recent global security situation following the US’s travel warning did not prove to be an important factor for markets over the past week, however barring a major event that is likely to be the case for the week ahead as well, suggests Greg Anderson at BMO Capital Markets.
Key quotes
However, “global security and local politics are background factors that might get a bit of market attention in a slow news week for economic data. The Australian election is now less than a month away.”
On Tuesday, the Australian Treasury issues are pre-election report on the economy and the fiscal situation. A positive outlook from that report may be interpreted as political ‘spin’ but with the market still trapped in very short-AUD positions, it could possibly trigger a further short squeeze in AUD/USD and AUD/CAD.”
Key quotes
However, “global security and local politics are background factors that might get a bit of market attention in a slow news week for economic data. The Australian election is now less than a month away.”
On Tuesday, the Australian Treasury issues are pre-election report on the economy and the fiscal situation. A positive outlook from that report may be interpreted as political ‘spin’ but with the market still trapped in very short-AUD positions, it could possibly trigger a further short squeeze in AUD/USD and AUD/CAD.”