In my last article, that you can read by clicking on here, I explained how all new lows are a buy in the Australian Dollar. I also explained how I felt that going long the Aussie Dollar is the best commodity trade idea that I had right now. Well, I still agree. The Aussie Dollar has fallen into a support zone that is allowing for a nice short-covering bounce and others have begun to notice. Matthew Bradbard just posted an article explaining why he is recommending the Aussie Dollar, that you should read. Also, I am pleased to find this article and video on dailyfx.com from David Rodriguez who has switched from a bear to a bull on the AUD/USD currency pair.
The main takeaway is that we broke down through the 2012 low, but when we traded at 93.21 on Tuesday, we came very close to the 2011 low of 93.01 and have started a nice bounce. Starting tonight, I have moved from trading the June contract, to the September contract, which trades about 62 pips lower. Support that should hold now in June at 94.00 means we should hold support in the Sept. contract at 93.38. Sentiment is now at extremes. Large speculators are now the most short they have been, in recorded history. I knew it was just a matter of time before we began bottoming, so I started buying all new lows in the Aussie. Now, instead of buying just new lows, we should be able to begin buying all dips in the Aussie.