Crashing Australian Dollar: Monthly Chart Update

Since August 2011 the Australian dollar has been in a bear market. The big counter rallies can fool us into thinking the Australian bear market is over.  The 2011 AUD peak and our CAD both ended as solar cycle 24 was finishing.

This is not something coincidental, as the sun cycles impact all currencies. In the last year or so we had a sideways rally that many figured was the start of a new bull market. I was raked over the coals about remaining bearish to the AUD and CAD.

Reality is starting to set in where this 4th wave rally is close to being completely retraced at the 68 cent price level, which is not too far away.

A wild erroneous spike still shows up but other settings do not confirm this spike, so I ignore them. No doubt about it, the AUD decline is not your picture perfect 5 wave impulse as they are rare in anything commodities related.

At 60 cents the Australian dollar would be getting close to the 2008 crash bottom which ended solar cycle 23.  The only difference between then and now is that the solar cycle number increased by one.

Australian dollar commercial positions are stacked to a net long position which is a bullish indicator but they can remain that way for extended periods of time.

I believe that the start of solar cycle 25 is going to be positive for both of our currencies but that knowledge means little if we have never experienced the mood change that solar cycles bring.

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