Metals and Oil Dragging Commodity Currencies Higher
Gold, silver, and oil all moved higher yesterday and as a result brought many of the commodity currencies with them.
The Australian dollar and the New Zealand dollar were putting in highs versus the U.S. dollar not seen since late July as both and were breaking above key levels trendlines and catapulting higher. Take a look at the price action below to see how the commodities and currencies were moving together.
Tradingview, COMEX, FOREX.com
Similarly, with moving higher, it is also carrying the Canadian dollar and the Norwegian krone higher ( and lower). Both Canada and Norway are oil-export-led economies. As a result, the movement of crude oil effects the currencies of both those countries.
As they say, a picture is worth a thousand words. When looking to trade commodity currencies, always make sure to check the underlying commodity to see if it could be ready for a big move. If so (and all else is equal), associated currencies may move with it.
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