Mitsubishi UFJ bullish on AUD: targets 0.7158, likely to break resistance.

Mitsubishi UFJ recently stated that in light of policy changes in both China and Foreign exchange eye official websitethe U.S., optimistic prospects for global economic growth are creating bullish opportunities for the Australian dollar against the U.S. dollar. The bank has initiated a bullish AUD/USD trading strategy, believing the Australian dollar is likely to rise further, breaking significant resistance levels from the past few years. Currently, the AUD/USD has steadied above 0.6900, approaching the February 2022 high of 0.7158.

The Federal Reserve's previous 50-basis-point rate cut has provided greater leeway for policy adjustments within China, aiding in increased economic support. Mitsubishi UFJ noted that China's commitment to comprehensive support measures and increased backing will bolster investor confidence and firmly drive China's economic growth. China's positive policy signals have spurred market sentiment, pushing the AUD/USD past previous critical resistance areas.

Strategists are optimistic about the Australian dollar's trajectory in the near term, particularly for commodity currencies with strong Chinese demand, like the AUD, which stand to benefit from the global market recovery. Increased fiscal spending or accelerated implementation of existing plans will further boost the upward momentum of the Australian dollar.

However, Mitsubishi UFJ also pointed out that the primary downside risk for the AUD/USD in the short term lies in the upcoming U.S. employment market report. If the employment data exceeds market expectations, it could challenge the market's expectations of quicker rate cuts by the Federal Reserve, thus exerting some pressure on the Australian dollar.

As of 8:42 AM Beijing time on September 30, the AUD/USD was reported at 0.6920/21, with subsequent movements worth watching.

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The market carries risks, and investment should be cautious. This article does not constitute personal investment advice and has not taken into account individual users' specific investment goals, financial situations, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their particular circumstances. Investing based on this is at one's own responsibility.

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