Show Pony For The Risk On Trade Is The Aussie Dollar, Is It About To Crack
The Aussie dollar has been the show pony for the risk on trade. Ben Bernanke endorsed the risk off trade today, yip that's right, he speaks stocks sell off and the dollar rallies. Who would have thought! All the Aussie dollar longs will be a tad nervous to say the least.
The Aussie dollar (FXA Etf) has been expecting to top out in mid 2011. It maybe here this week! The perma $AUD bulls may (but very unlikely) keep it up for a while yet, but we are hoping to sell it on a break out south. The boomerang is coming back.
Here is a chart showing the cycle top expected in 2011. Just like clock work (created at 04/2011).