We know Australian dollar is losing its ground recently. It is, in fact, the worst-performed currency in Asia Pacific for year 2008. (It reminds me, it used to be the top performer not long ago 😆 )
I had a look at monthly chart to have a view and feel how bad is the situation right now. Basically, market is wiping out all the gains since Howard government, and the years-long economy honey moon since, approximately, year 2001.
If the currency reflects the economy condition of a country, here is a “chart view” of Aussie economy.
The poor (unlucky ?) Labor party, Mr. Kevin Rudd takes over Australia at the “right time”. Soon after Labour party in charge, we have economy slow down, then collapse of Australia dollar to 5-year low. In short, he takes over Australia at the TOP, well, short term TOP and historical resistance zone. (John Howard took over at the bottom, and support zone though). This cycle should be very close to commodity cycle.
So now, the interesting part is, are we heading back to the previous bottom? or are we able to bounce from this “retracement”? I feel, this will also indicate the duration of Labor party staying in power…
Just my random rant.