Aussie Dollar Takes Out July 2008 Top; Upside Momentum Still Building

The Australian Dollar surged overnight after a government report showed the nation added more jobs than economists forecast. The rally in the Aussie took out the July 2008 record high at .9849 while upside momentum indicated the market had enough buying power behind it to drive it even higher.

The Australian Dollar surged overnight after a government report showed the nation added more jobs than economists forecast. The rally in the Aussie took out the July 2008 record high at .9849 while upside momentum indicated the market had enough buying power behind it to drive it even higher.

The overnight report showed that Australia’s employers added 49,500 workers and the unemployment rate held at 5.1 percent in September. Estimates were for an increase of 20,000 jobs.

This employment report confirms that there is still a lot of momentum in the Australian economy, leading to further speculation that the Reserve Bank of Australia will have to raise rates again in the near future. Earlier this week, the RBA passed on a chance to hike its benchmark rate, citing moderate inflationary growth.

At this time there is nothing to stop the upside momentum in the AUD USD. The interest rate differentials remain very supportive especially since the U.S. Fed is expected to continue to ease.

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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