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AUD steady on iron ore

One of the key themes in US trade was a weaker greenback on the back of disappointing retail sales, PPI, NFIB small business index and business inventories data.

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
AUD
Source: Bloomberg

The USD lost ground to the majors with the exception of the AUD, which has been in focus on the back of iron ore and a raft of releases from China. AUD/USD has been tracking iron ore and has managed to bounce over the past 24 hours.

With iron ore trading back above $50/t, some confidence has returned to the local currency but the vulnerability is still very much in play. A lot hinged on China’s data today, and of course the jobs numbers out tomorrow.

The pair is currently just hanging on to $0.7600 and further volatility is likely on the way. Needless to say the market broadly expects further AUD weakness.

While it is tempting to sell at current levels, I feel waiting for a bounce is the best value proposition on the AUD. The current momentum in iron ore prices could take the pair a bit higher in the near term and I would then look at selling into that strength.

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.