This week, the macro and market landscape provides a rare alignment across all major models—making AUD/USD the standout short opportunity among G10 FX pairs.
Key Reasons for the Bearish AUD/USD Bias:
1. Commitment of Traders (COT):
Institutional positioning has turned decisively bearish on the Australian dollar, with net shorts increasing and sentiment remaining negative.
2. Z-Score & Positioning Extremes:
Z-Score indicators confirm a below-average long bias for AUD, highlighting that recent speculative flows are heavily skewed to the short side.
3. EXO/Score Model:
Our EXO (macro scoring) model gives AUD/USD a clear SHORT rating, with no offsetting bullish factors in the “core” or “risk/reward” signals.
4. Commodity Edge – Iron Ore:
Iron ore prices, a crucial driver for AUD, have sharply declined in recent weeks. This is a classic “canary in the coal mine” for AUD weakness historically, persistent iron ore declines precede broader AUD selloffs.
5. Sentiment & Risk Environment:
Despite global “risk-on” sentiment, AUD is unable to benefit, as both macro and market participants rotate away from commodity FX and into USD strength.
6. Endo (Fundamental) Model:
While Australia’s macro data still looks solid on a lagging basis, all faster models (positioning, flows, sentiment, commodities) point to an imminent shift typically, ENDO lags in catching turning points.
Conclusion & Tactical View:
SHORT AUD/USD is the highest conviction trade for this week, backed by full alignment of macro, positioning, sentiment, and real-economy factors.
Expect continued downside pressure while commodity markets and COT data remain bearish.
For active traders, the first 3–7 days following this setup historically provide the highest reward-to-risk moves.
Key Reasons for the Bearish AUD/USD Bias:
1. Commitment of Traders (COT):
Institutional positioning has turned decisively bearish on the Australian dollar, with net shorts increasing and sentiment remaining negative.
2. Z-Score & Positioning Extremes:
Z-Score indicators confirm a below-average long bias for AUD, highlighting that recent speculative flows are heavily skewed to the short side.
3. EXO/Score Model:
Our EXO (macro scoring) model gives AUD/USD a clear SHORT rating, with no offsetting bullish factors in the “core” or “risk/reward” signals.
4. Commodity Edge – Iron Ore:
Iron ore prices, a crucial driver for AUD, have sharply declined in recent weeks. This is a classic “canary in the coal mine” for AUD weakness historically, persistent iron ore declines precede broader AUD selloffs.
5. Sentiment & Risk Environment:
Despite global “risk-on” sentiment, AUD is unable to benefit, as both macro and market participants rotate away from commodity FX and into USD strength.
6. Endo (Fundamental) Model:
While Australia’s macro data still looks solid on a lagging basis, all faster models (positioning, flows, sentiment, commodities) point to an imminent shift typically, ENDO lags in catching turning points.
Conclusion & Tactical View:
SHORT AUD/USD is the highest conviction trade for this week, backed by full alignment of macro, positioning, sentiment, and real-economy factors.
Expect continued downside pressure while commodity markets and COT data remain bearish.
For active traders, the first 3–7 days following this setup historically provide the highest reward-to-risk moves.
⚡ Actionable setups.
⚡ Weekly fundamental bias.
⚡ Macro, sentiment, and positioning insights.
🛡️ Follow now and trade with an edge, not noise.
⚡ Weekly fundamental bias.
⚡ Macro, sentiment, and positioning insights.
🛡️ Follow now and trade with an edge, not noise.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
⚡ Actionable setups.
⚡ Weekly fundamental bias.
⚡ Macro, sentiment, and positioning insights.
🛡️ Follow now and trade with an edge, not noise.
⚡ Weekly fundamental bias.
⚡ Macro, sentiment, and positioning insights.
🛡️ Follow now and trade with an edge, not noise.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.