Correlation between DJI and AUD

As Mimi pointed out after one of my posts the correlation between the DJI and AUD/USD cross has been extremely high. As can be seen on the chart above that's true. Maybe the latest rally in AUD/USD cross should have been a warning that the rally in the DJI or the S&P 500 wasn't over yet.

I do recognise correlations and the correlation between the DJI and the AUD/USD cross has been higher than most for a long time, but these correlation has a way to suddenly disappearing and when they does, it takes time to recognise the disappearing, therefore I always make my analysis based on just how I see the DJI or the AUD, but I will give to Mimi that if the DJI or S&P 500 was trading higher my calling for a top in the AUD and CAD probably was wrong. Now we know and again, that is what stops are for. Those two trades where very low risk, with a great reward potential.