DownUnderPaddy

OK fXperts......this is now predicting an exchange rate between 1.49 and 1.56 by mid 2011. Think it's on the ball ?

Extrapolation analysis into mid 2011
http://www.marketoracle.co.uk/Article23511.html

From the article...
"The Australian dollar is clearly in a powerful multi-year uptrend that has its basis in structural fundamentals both economic and resource based rather than technical. The range appears to be between a low of 0.58 and a new all time high 0.67 against the last 0.62. The trend targets a GBP/AUD rate of between 0.64 and 067 by mid 2011 (+3% to +8%)."

Scenario: What would I do if I NEEDED to convert from Sterling to AUD by Mid 2011?

Recommendation: "Given that the Aussie Dollar is expected to continue strengthening against sterling, I would bite the bullet and transfer an amount of 5-10% every week, and take advantage of any dips to below 0.60 (could trade to 0.58 to transfer larger percentages)."

freebo

I've been reading the Market Oracle regularly for a couple of years and his own forecasts seem fairly good, but I wouldn't put my house on them.

The articles he posts by others are often interesting too.

neil248

Can't help thinking this is probably the way things will go and stay that way for a long time.

It hurts a lot as part of my income comes from the uk and in the time we have been here the rate has gone from an average of 2.4 for a fair period down to the 1.6 we have now which is over 30% reduction in purchasing power for the same amount of work done.

DownUnderPaddy

The MarketOracle article from October seems to be playing out as it predicted....so far anyway.

This latest mid day report from Dec 6th.

"GBP/AUD is back under pressure after multiple attempt to take out 55 days EMA and failed. Short term outlook is mildly bearish for a test on 1.5763 low and break there will confirm long term down trend resumption. In such case, GBP/AUD should target 61.8% projection of 1.7603 to 1.5763 from 1.6380 at 1.5243 next. On the upside, in any case, break of 1.6380 resistance is needed to confirm bottoming. Otherwise, outlook will remain bearish."


At 1.587 now. Will it break through the 1.576 being tested ?
If so, next stop 1.52......

Robbie37Michelle32

To be honest these companies try and scare people into parting with their money saying the exchange rate will drop ect ect no one knows for sure once interest rates rise in UK USA the pound will grow stronger as its been devalued for a lonbg time.

I will not be transfering my money to OZ for a while.

Do you think if the Dollar became so strong people would want to come over given the costs of the move house buying ect Say the sold their house and got 100k to take if the dollar was 1.40 thats gives them only 196k not much really that wouldnt even buy a shed.

DownUnderPaddy

I don't really care about the rate (I have been living here 8 years). Just fascinated with the economics and the continuing downward trend ove the last 5 years (that shows no sign whatsoever of stopping). Would suit me fine though if people stopped coming as my train would't be so packed then ;-)

Robbie37Michelle32

LOL Well there will be 3 more coming soon sorry I have been watching the rate for 4 yrs the world is in a mess devaluing the currancy over valueing the rate ect ect so it will be a waiting game for a lot of people.

It wouldnt be so bad at that rate if the housing market followed too then it would even out

DownUnderPaddy

Oooohh...saw the news regarding the british unemployment rate increase. Watch that rate drop in response....1.579 - just a smidgen off that low now. Will it rebound, or carry on through !

lancastrian48

shit whateva

DownUnderPaddy

http://www.forexrate.co.uk/news/fomc...hanged-at-025/
"GBP/AUD this morning continues to test the all time low at 1.5765 following the Jobless claims release, with a break of “support” opening up the way up to significant selling from speculators"

and at 1.57644, here comes the break....watch those speccie-laters sell !

DownUnderPaddy

Wow, forget mid 2011.
At 1.55, it's already in their forecast range.

That record government borrowing announcement certainly hasn't helped things....
http://www.guardian.co.uk/business/2...ts-record-high

cazza36

went into town today to start buying our dollars, bets rate was $750. for £500 sterling! 1.50 to the pound! not to sure to wait or not ( we are coming over Jan 7th on a 4 year Visa! any ideas

brendarover

Yep, don't go, even at 2.5 to 1 thinfgs ain't cheap, at 1.5 to 1, i just would not bother.

Australia has serious problems amounting to costs, you will be paying alot for not alot i am afraid.

bingobob777

depends what you plan to do with your wages in Australia. I'm coming over in February for 4 years and plan on returning at the end of it. The lower the exchange rate the more £ I send back every month and the bigger house I get to buy back here in 4 years.

Real question is whether it's better sending it back to get 3% interest or hanging on to it in Australia and getting 6%. It's a gamble either way, but my feeling is that the tide will turn at some point and when it does the £ could strengthen by 10-20% easily in a few months.

DownUnderPaddy

As a summary statement, I believe the above is true.

The UK has had to face some serious economic woes in the past few years and with yesterdays announcement of the record high government borrowing figures and the fact that 2011 targets may not be achieved, those woes could continue for some time yet.

Australia has not hit its downcycle yet, but as costs of housing and living continue to rise here, it is just a question of time. Bust follows boom as sure as night follows day. That is simply the world we live in.

So, although the GBP/AUD rate has been in almost constant decline for the last 5+ years (with the exception of a brief respite during the GFC), it has to be getting to the point where that decline will at least stop and eventually start to reverse.

Unless you have a dire need to convert in order to fund your transition, I would be saying leave it where it is.

For the last few years, my posts on this topic have been that the exchange rate was a downward trend and that there were no economic reasons for that to change. As the rate approaches 1.50 and given where the UK/AUS are now in their economic cycles, I feel that this may truly be the floor and that the trend could reverse (or at least flatten out) from mid 2011.

Should something extraordinary happen, like the collapse of the Euro, things may change much more drastically, but that is a purely speculative scenario and I find it better to observe based on normal economic cycles/trends.