Experts from large investment banks Bank of America Merrill Lynch (BofAML) and Citibank assess the current situation on the main currency pairs and indicate the further direction for AUD/USD, USD/CAD and NZD/USD trading.

BofAML: Bullish on USD/CAD, bearish on NZD/USD

Analysts from Bank of America Merrill Lynch are increasingly focused on NZD/USD drops while maintaining a pro-growth attitude for USD/CAD. They point out that their assessment is based on medium-term valuation and expectations regarding the further monetary policy of central banks.

“Growths on the USD/CAD pair are additionally supported by flows, price position and price impetus, a potentially powerful set of signals rarely combined together,” the report reads.
On the other hand, declines in NZD/USD are, according to experts, supported by seasonality.

Citibank: Long on AUD/USD

Citibank’s analytical team maintains its long positions on AUD/USD, mainly due to the recent de-escalation of trade tensions between the USA and China. Recent movements in the Australian dollar index also point to the strength of AUD.

“The chance that the Chinese economy will catch a breath has risen, which in turn will bring Australia additional momentum and we expect a better reading of the data soon. This is undoubtedly an opportunity for the appreciation of the Australian dollar, which weakened as the market discounted interest rate cuts” -the report shows.

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