AUD USD Showing Signs of Short-Term Top

Weakness in the equity markets may spill over to the stock marketsensitive Australian Dollar.  There is already a sign of a topdeveloping on the AUD USD hourly chart.  Late session the main trendturned down on this chart.  Based on the weekly range, this marketcould be setting up for a break back to.7630.

The strong rally in the AUD USD market puts the market in a position to challenge the major 50% price at .7928, but a late session break in equity markets could be indicating a short-term top may be forming on the daily chart.

The entire rally this week in the AUD USD has been buoyed by traders seeking greater return on their investments through higher yielding assets.  Today’s rally in U.S. Treasury futures along with the late session break in U.S. equity markets may be sending a signal that the demand for higher yielding assets may not be a strong as speculators think.  This may lead to the start of a profit-taking break as traders become more averse to risk.

Weakness in the equity markets may spill over to the stock market sensitive Australian Dollar.  There is already a sign of a top developing on the AUD USD hourly chart.  Late session the main trend turned down on this chart.  Based on the weekly range, this market could be setting up for a break back to .7630.

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

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