Revived Risk Appetite Drives Commodity-Linked Currencies Higher

Revived risk appetite is driving the Australian, New Zealand andCanadian Dollars higher at the mid-session. The main catalysts behind the rallyare the stronger Euro and U.S.equity markets.

Revived risk appetite is driving the Australian, New Zealand andCanadian Dollars higher at the mid-session. The main catalysts behind the rallyare the stronger Euro and U.S.equity markets.

The Aussie is up for the first time in six days but the maintrend remains down. Over the losing streak, the Australian Dollar dropped from.8961 on May 13th to today’s low at .8070. Friday’s break took the Aussie toits lowest level since the week-ending July 24, 2009. The lower-low, higherclose formation taking place suggests the start of a possible 2 to 3 rally with.8728 the next upside objective.

Greater demand for higher risk assets and oversoldconditions are also helping to boost the NZD USD. Although this market is notin a position to form a daily closing price reversal, watch for the start of a2 to 3 day rally with a possible retracement to .6981.

The USD CAD slammed into resistance slightly above the oldtop at 1.0738, reaching a high of 1.0749 before turning south. Oversoldconditions and a strong equity market helped trigger today’s profit-takingbreak. The intraday action suggests the formation of a closing price reversaltop. This pattern suggests the start of a 2 to 3 day break with 1.0430 thefirst objective followed by 1.0354.

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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