Booking Profit on AUD/USD
AUD/USD retraced higher earlier this week as the USD weakened. But, we decided to sell at the 100 SMA,where it reversed down
[[AUD/USD]] has turned bearish since early this year. Tensions in the Middle East, and then the outbreak of coronavirus proved to have a bigger impact on markets, than the Phase One trade deal. Since then, the trend has been completely bearish, as the sentiment remains strongly negative.
During this time, moving averages have been doing a great job in providing resistance and pushing this pair down. AUD/USD has lost around 500 pips since early January and it doesn’t seem like the decline is going to stop anytime soon, not as long as coronavirus spreads, especially in East Asia.
On the other hand, if the virus spreads further in the US and around the globe, the world economy will likely weaken and the FED will start cutting interest rates again. Anyway, the main trend still remains bearish and MAs are still providing resistance. The 20 SMA (grey) was rejecting the price earlier, so we decided to open a sell signal in this pair. Overnight, the sentiment turned negative again and risk currencies tumbled lower. As a result, we booked profit on this signal.
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