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Australian dollar assumes the brace position

Published 22/08/2022, 09:47 am

DXY is up and away and that’s the end of everything bear market rally:

 

AUD bye, bye:

Markets getting ever shorter:

Everything EM (NYSE:EEM) and commodities is junk:

The Treasury curve steepened:

Stocks puked:

The bear market rally is over. DXY is signaling a major push to save haven assets. There are tail risks in this, the most obvious of which is that Chinese capital outflow will accelerate and CNY/USD tumble. It has broken support:

Note that the last big wave of selling for stocks and the AUD coincided directly with CNY falling out of bed.

Given it is probably only halfway down I suggest that you bend over and place your head firmly between your legs.

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