Tom Scollon

Yes I have been reading a trifle about how some acclaimed currency traders are calling the end of the Aussie dollar. Talking up their own book me thinks.

The charts speak:

AUD Us Daily Line Chart
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AUD - USD Daily Line Chart
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Both the 90day and 300 day chart has the Aussie down at about 94 cents. Why you might ask am I so non plussed about this?

Well markets move up and move down and it is what it is. There are numerous factors that drive the Aussie and not all these are Australian land based – they are international and Australians or the Reserve or Government can do little to shore up one way or the other. It is just another currency.

Well actually it is little more than that. It is a highly traded currency and also it is some proxy to the demand for raw materials – and thus world economic outlook.

So it will ebb and tide.

Many Australian see it as the ‘Goldilocks’ currency – their Goldilocks – and they just want it just right – not too high not too low. Self serving you might say. But aren’t we all? But there can only be wishes as the currency will do as it is told by global interests.

So a low in the next few months and after that? Let’s look at a weekly and a monthly:

Click to Enlarge

Click to Enlarge

The weekly says it is just range trading and the monthly says this is just long term consolidation before the next big move – and I mean a big one.

I feel comfortable about what the charts are telling me – even at $1.30/$1.40 – it can happen in my life time again.

And it is what it is

Enjoy the ride

Tom Scollon