Aussie Dollar Forming Reversal Top

After hovering on both side of anuptrending Gann angle at .9570 today, the Aussie Dollar finally succumbed toselling pressure, triggering a break from its high and putting it in a positionto form a daily closing price reversal top.

After hovering on both side of anuptrending Gann angle at .9570 today, the Aussie Dollar finally succumbed toselling pressure, triggering a break from its high and putting it in a positionto form a daily closing price reversal top.

Weakness in U.S. equity markets is to blame fortoday break in the AUD USD. Once it became clear that the stock market did nothave enough buying power to regain yesterday’s high, demand for higher riskassets fell, triggering a profit-taking break in the Australian Dollar.

Although the Australian economy is muchstronger than the U.S.economy at this time and its central bank has been raising interest rates whilethe Fed is likely to begin another round of stimulus, investors are concernedthat the faltering U.S.economy may derail the entire global recovery. This concern is encouragingbullish Aussie Dollar traders to take a little off the top while tradersreassess their risk parameters.

Based on the main range of .8770 to .9599,a closing price reversal top will set up a possible correction back to .9184over the short-run.

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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