Watch for Divergence Between Equities and Aussie to Indicate Top

The Australian Dollar has been posting gains along with the equity markets, but signs are developing that could be indicating a possible short-term top.

Appetite for risk increased following the release of the FOMC results.  This helped drive the AUD USD to a new high for the day.  This market is following U.S. equity markets and is expected to do so into the close.

Any divergence between the Aussie and the equity markets will indicate that traders believe that Australian Dollar is overbought for the short-term.  This could trigger a profit-taking break.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More