U.S. Dollar Extending Winning Streak versus Aussie and Kiwi

The Greenback is up against thecommodity-linked currencies, extending it winning streak versus the Australianand New Zealand Dollars. Fears of a global economic slowdown fueled by thismorning’s unexpected rise in unemployment claims, pressured equities whichhelped curtail investor demand for risky assets.

The Greenback is up against thecommodity-linked currencies, extending it winning streak versus the Australianand New Zealand Dollars. Fears of a global economic slowdown fueled by thismorning’s unexpected rise in unemployment claims, pressured equities whichhelped curtail investor demand for risky assets.

Some of the weakness in the Aussie wastriggered last night after the Australian unemployment rate unexpectedly roseto 5.3 percent in July, compared to the median forecast of 5.1 percent. Furtherdownside action was fueled by the U.S. Weekly Initial Claims Report whichshowed an increase of 2,000. This number pegged total claims at 484,000, thehighest level since mid-February.

Technically, the Kiwi and Aussie areslightly oversold on the short-term charts, but the daily charts indicatefurther downside action is likely.

The New Zealand Dollar is nearing anuptrending Gann angle at .7048 which could produce a technical bounce, butultimately downside momentum is likely to pressure this market into a 50% levelat .6977.

The Australian Dollar broke an uptrendingGann angle this morning, triggering stops. Look for an acceleration to thedownside if the late July swing bottom at .8904 is violated. Although itsprimary downside target of .8644 is pretty far-off at this time. This patternshould not be taken likely since it suggests that a major fundamentaldevelopment may take place which drives this market sharply lower over thenear-term. A combination of an uptrending Gann angle and the 50% level of .8644suggest that this price may be tested on August 13th. Bad news from China may bethe catalyst which triggers a free fall.

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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