The Aussie Dollar/Swiss Franc cross rate is a very good indicator of problems to come (
ie bear
markets) or a turn towards higher risk taking (bull markets). In the boxes are the periods of time that I have noted as bull and bear market time frames. The cross rate tracks these periods of time very well though one could argue that given the problems in the
Eurozone and the massive amount of money flowing into the
swissie from
Europeans, the ratio is losing its luster. However, it is a warning sign that
perhaps more
problems are on the horizon for the commodity currencies and the global bull market. The 87/90 area is key as the bull market from earlier this decade held that support while things in the equity markets really got bad in 2008 when the ratio walloped the support. At the moment, just a warning sign that it is below trend.
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