AUD/USD turned bearish at the beginning of January, after having some good times in the last few months of 2019. But, the situation reversed as soon as the new year began, with the tensions in the Middle East and the coronavirus outbreak, which hurt the sentiment in financial markets.

As a result, risk currencies such as the Aussie turned bearish. This pair has lost around 360 pips from top to bottom. We saw a steep decline in the first two weeks of January, then the pace slowed for some time, but the decline picked up pace again towards the end of January.

This month, the sentiment has improved somewhat and the decline has stalled for the time being. AUD/USD has been trading inside a range, but the pressure still remains to the downside. Moving averages such as the 100 SMA (green) have turned into resistance in the H4 chart and it rejected the price again earlier today.

We decided to sell this pullback higher below the 100 SMA, which is being aided by the 50 SMA (yellow) as well. So, we’re short on AUD/USD now, waiting for the bearish trend to resume.