What assist in AUD/USD’s downtrend is AUD/CAD. AUD/CAD held the longest time above supports at 0.9500’s and 0.9400. I still lack my system so don’t know the exact points. When AUD/CAD broke below then both AUD/CAD and AUD/USD saw fresh downsides. The significance of AUD/CAD and AUD/USD is both are the exact same pair and share a wonderful relationship. This has always been the case. But AUD/CAD is a market measure to risk on / risk off and historically movements are extremely slow. Under slow movements, its the pair among all AUD pairs that contains AUD/USD movements. Slow movements means like 500 pip ranges over many years. The fact that AUD/CAD broke significant points means both pairs in the larger picture will see more downsides. The next major point for AUD/CAD is in the low 0.9200’s, its another 150 pips. But to really understand AUD/USD, its a Silver currency whose relationship still holds its 200 yer tradition when AUD was first pegged to its Silver currency brother, GBP. Attached is a chart to show AUD/USD and its Silver relationship. Its a solid solid relationship that won’t ever break under any market or fundamental scenario. http://fxtop.com/en/historical-exchange-rates-comparison-graph-zoom.php?C1a=AUD&C1b=USD&C2a=AUD&C2b=CAD&C3a=XAG&C3b=XAU&C4a=XAU&C4b=XAG&C5a=&C5b=&C6a=&C6b=&C7a=&C7b=&C8a=&C8b=&C9a=&C9b=&C10a=&C10b=&DD1=01&MM1=08&YYYY1=2015&DD2=08&MM2=09&YYYY2=2015&LARGE=1&M=1&LANG=en
The points and targets offered will be very close but not exact.
AUD/USD. Bottom. 0.6918. Range break above 0.7070, 0.7092,0.7102, Below 0.6975. Overbought sell point, none exists. Strategy. Shorts and longs must look at next ranges at 0.7070 and 0.7092 as long and short points. I would view 0.7070 vicinity as short point to 0.7011. I don’t have much to offer until China opens. I will report again in about 2 hours.
Brian Twomey Inside the Currency Market, btwomey.com