I am thinking of gradually building a good sized long position on the aussie. I generally trade with a several day all the way to several month time frame.
I am bullish on the AUD for several reasons. A pick up or continued trend in the commodities space. The Australian economy continues to show strength actually growing in GDP (shocker!). I also think that Australia will be one of the first to raise rates which should continue to add juice to the carry trade.
I am currently neutral to slightly bearish on the USD. I am considering switching to the AUD/JPY long as well. For the dollar I am on the inflation side of the fence. I think that ridiculously loose monetary and fiscal policy will weigh on it. Furthermore, I don't see the FED raising rates anytime soon, at least not before Australia.
My concern would be if the market starts to roll over, which I think it will (or go sideways for awhile) there will be a flight to "quality" helping the dollar.
Any thoughts? Bearish counters?
