Copper Breakdown Suggests a Lower AUD/USD Rate

28. November 2014 · Write a comment · Categories: Uncategorized · Tags: , ,

One of the stronger correlations (over time) between currencies and commodities is the strong Australia Dollar and Copper correlation:

11-28-14AUDHG

Today, copper made a significant surge lower breaking key technical support at 2.88. At minimum, copper looks set to test the 2.50 (Fibo) support:

11-28-14HGweekly

If you take a good look at the AUD/USD weekly chart, it looks set to test below .8000:

11-28-14AUDWeekly

For the last couple years I have been looking forward to getting on the long side of the AUD/USD below .8000, and it looks like this time it could actually happen. However, one has to wonder….If the Dr. (Copper) has a PHD in economics, what is this current move suggesting? Some would think that the good doctor has either failed a few classes on the way to getting the PHD or royally screwed up his/her dissertation. But with China continuing sluggish growth (relatively speaking) and global deflationary pressures mounting, perhaps we should pay a little closer attention to what the doctor is telling us.

 

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I am short the AUD/USD from 2+ weeks ago.

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GBP/AUD Bull Flag in a Bull Flag

05. November 2014 · Write a comment · Categories: Uncategorized · Tags: ,

The GBP/AUD is attempting to break a out in a bull flag pattern, while in a weekly bull flag pattern. Here is the daily chart:

11-5-14GBPAUD

What you may notice, the bull flag is already in process on the longer time frames as well. The most recent highs of 1.8681 will offer the near term resistance, but if broken the 1.9184 (1.9211) level will be the major resistance for the weekly bull flag pattern as seen below:

11-5-14GBPAUD2

If the 1.9211 (38% weekly Fibonacci level) breaks it could open the door for a move toward 2.20 in 2015.

Blake Morrow

Chief Currency Strategist, Wizetrade

 

Disclaimer: I am not long the GBP/AUD but plan on establishing a long in the next 72 hours.

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