ForexPros Daily Analysis June 22, 2011
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Expert: Andrei Knight
Start: Wed, Jun 22, 2011, 11:00 EST
End: Wed, Jun 22, 2011, 12:00 EST
Learn how to avoid analysis paralysis by knowing which indicators work best under which market conditions, as well how to spot the signs that those conditions may be changing. Turn lagging indicators into leading signals. Join leading fund manager and trading coach Andrei Knight for this insightful webinar which will present new ideas for your trading repertoire, and show you how to use familiar indicators in unique (and profitable!) ways.
Mr Knight has has made frequent appearances at events such as the World Money Show, Traders Expo, IX Investor, the Energy Forum, and was the keynote speaker at 2009's International Traders' Conference. He is the author of Trading Forex for a Living, coming soon from Harriman House, the Institutional Trading Secrets Revealed! DVD from Rockwell Trading.
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Is AUD/CAD Building a Top?
The commodity currencies have stalled their recent rallies. For the most part, the respective central banks have been hesitant about raising interest rates, something that market participants wanted to see. In addition, the renewed European debt crisis decreased speculative money flow into these currencies.
There is little movement in crosses of these currencies. For example, following an uptrend, the AUD/CAD has been in a 300 or so pips range for the last months. While the current action looks like a consolidation on daily charts, a possible top is emerging on a smaller time frame.
On the intermediate term chart, we can see how the AUD/CAD rallied from 1.0303 to a new high of 1.0554. A sell off to 1.0287 was next, followed by another price run up. This time, however, there was no new high, only a 1.0422 level. At present, the price is back at the 1.0290 support.
Based on the oversold Stochastic indicator, chances are that this level might hold for now. However, that will only make it even more important. Should the price eventually close under 1.0290, it would mean a confirmation of top for the AUD/CAD, projecting additional 150-200 sell off.
Forex Trading Analysis written by Mike Kulej for ForexPros. For more information about technical analysis visit ForexPros.
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