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Dec 02 - 12:12 PM
AUD/USD - COMMENT-AUD/USD Traders: Look At NZD And You'll Know What To Do
First appeared on eFXplus on Dec 02 - 09:50 AM

The current NZD/USD rise is a short squeeze that will probably intensify this month nL1N28C03T.
AUD/USD traders hold bigger bets on a drop and some of the factors behind the NZD/USD rise are similar to those that may lift AUD/USD in December, too nL1N28C04W.
AUD/USD is much more liquid than NZD/USD, perhaps with similar market depth to the pound, but that once crashed, so there is enough risk to worry about in the month of December when liquidity comes at a premium.
Liquidity is better than NZD's, but the number short AUD/USD is about $1 billion larger at $3.2 billion.
Those who are sitting short AUD/USD are vulnerable to the current environment, which supports riskier assets and therefore may well support commodities, which should underpin AUD.
Iron ore has risen around 10% in 15 days.
Copper has only risen around 1% in the same time but is 4.7% above October's low.


AUDUSD shorts iron ore and copper: Click here

Source:
Refinitiv IFR Research/Market Commentary

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