AUD/USD has been on a bearish trend since the middle of last month when it completed a retrace higher on the daily chart. It reversed just above the $0.72 level at the 100 SMA which has been working as support on the daily time-frame and during the decline this pair lost around 350 pips.

But towards the end of last week we saw a reversal and a climb higher which lasted for nearly 80 pips after the weak manufacturing and services reports from the US. The price broke above the 20 SMA (grey) and the 50 SMA (yellow) on the H4 chart. The 50 SMA has been providing resistance in the last few weeks but it got broken pretty easily.

Although, the 100 SMA resisted well. It provided resistance this morning and AUD/USD has reversed from there now and is more than 20 pis down. I know it’s not much, but today is pretty quiet with the UK and US being on holiday, so don’t expect much. But, the retrace is complete now and the main trend is bearish, so the downtrend might have already resumed.