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AUD/USD session preview Monday September 9th

There hasnt yet been much reaction to the as-expected win by the Liberal/National coalition
in the general election. Best not to judge too soon as we may see some big traders, especially
overseas players, wait until liquidity improves today before adjusting their positions and
hedges. Chinese trade data released over the weekend showed a continued improvement and
this should give the AUD a mild bullish tone at least in early trade. Todays economic
calendar has Japanese GDP and Chinese CPI, with the latter more likely to move the market.

TECHNICALS: The short-term charts still favour the bulls (see chart) but if prices cannot
break above .9235 then we may well see a reversion to range trading between .8900/.9230.
Initial support on the day is at previous highs near .9170. The daily chart will remain bearish
until the previous pivot at .9330 can be solidly broken.

CROSSES: I remain bullish on AUD/JPY after the double-bottom on the daily chart and my
initial target is at 93.00 (see chart). A clean break above there would certainly put the bulls
back in control. Support levels are clear at 90.00.
AUD/NZD has struggled to keep up with the AUD gains elsewhere but an extended
1.12/1.1750 range trade looks possible.
The weekly close below 1.4350 has the EUR/AUD looking vulnerable to further losses.

ORDERS & FLOWS: Prime brokers report quite large stop-loss buy orders in the
AUD/USD above .9240.

INTRADAY CONCLUSION: Id look to play a tight .9170/.9230 range in early trade but I
still prefer the buy-dip strategy. The AUD continues to show reasonable strength on the
crosses and we may see a push higher to test those stop-loss orders above .9240.

TRADE OF THE DAY: Its not necessarily my side in that Im overall bearish on the JPY
but risk-reward would seem to suggest that selling USD/JPY with a stop above 100.25,
targeting 98.25, is a reasonable trade idea. I also remain very bullish on the GBP and I feel
that we will very soon get a test of important technical resistance in cable near 1.5750, so
buying intraday dips to 1.5570 makes good sense to me there.

Good luck out there.