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VIDEODeveloping a Global Macro View
Currently this perspective incites caution on anything dependent on global economic growth (commodities, commodities related equities, and commodity based currencies).
Australian Dollar vs. US Dollar (AUD/USD)
AUD/USD turned sharply lower following the recent short-term top (end of wave b). The downside target for this abc correction remains the 100% Fibonacci price projection at 0.75371, a long way from the current 0.84 area.
If the Aussie Dollar is to weaken that much, then it's highly likely that industrial commodities and Australian equities will be in decline, too. Australia is a major commodities producer and heavily dependent on exports to the Asia-Pacific region.
Copper ETF (JJC)
Copper -- an extremely important and economically-sensitive commodity -- is barely clinging to support. The Copper ETF (shown above) is down 6% this week and needs to hold $38.45 (horizontal line support, lower dashed blue line) for bulls to have hope.
The Baltic Dry Index is an important leading economic indicator. It's also extremely volatile. For this reason, I never analyze this chart in isolation. In this case, you can see that recent price action in the index is confirming what’s happening in other indices and asset classes. What has my attention is the severity of the decline over the last month -- down 41% in June -- without any bounce at all. Again, this is a supporting piece of technical evidence.
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