Tuesday, 6 September 2011

AUD/USD smashes downward through trend line

I believe there's a Reserve Bank of Australia (RBA) board meeting today, which might be good for some added short-term volatility. However, whatever the RBA does or doesn't do won't have any impact on the AUD/USD's trend, which is down. Market sentiment is steering the ship, as illustrated by the charts, and the RBA board is merely the on board entertainment, painted clowns or similar.

Hourly candlestick chart shown below. The market ended last week testing the trend line, and has since smashed downward through it...


Zooming out to a long term daily chart, we see that the market has "kissed goodbye"to the trend line formed from the mid-2010 low, indicating that the move down in July and August was likely a kick-off to a new down trend.

Aussie ASX SPI 200 smashes downward through trend lne

Hourly candlestick chart shown below, including after hours trading, which projects a Tuesday open of 4089ish, lower than Monday's 4142 ASX 200 close. The market ended last week perched on the trend line, and has now smashed lower through it.

EUR/USD moves lower through 2011 trend line

Long term daily candlestick chart shown. The EUR/USD has now moved lower through the trend line formed from the 2011 low, as well as through the steeper parallel trend line shown previously...

S&P 500 smashes downward through trend line

Hourly candlestick chart shown below. Only 11 hours ago, the market was testing the line. It has since smashed it...


Zooming out to long term daily candlestick chart, I am wondering if the same parallel trend line angle that applied in 2007, 2008, and 2009 will be of value again, perhaps providing a target for the current decline. Time will time...