AUD/USD Reverses Higher As the Retrace Is Complete
AUD/USD retraced deeper today, but the 50 SMA turned from resistance into support and reversed this pair back up
[[AUD/USD]] has been bearish for a long time, but it turned higher in the third week of this month after comments that US and China were reaching a partial trade deal. That improved the sentiment in financial markets, which benefits risk currencies such as the Aussie and the Kiwi.
As a result, this pair climbed more than 200 pips higher. Although, this pair retreated lower last week, after Boris Johnson’s Brexit deal didn’t pass the meaningful vote in the British Parliament. But the bullish trend resumed again this week and the 20 SMA (grey) has been providing support during pullbacks lower.
Today, the retrace was deeper and we saw another pullback lower on the H1 chart, but the retrace was complete a couple of hours ago, with the stochastic indicator being oversold. Besides that, the last two H1 candlesticks closed as dojis, which are reversing signals, and the 50 SMA (yellow) turned into support, so this pair reversed and is heading higher now. We could have gone long from the 50 SMA, but the FED meeting later today might send the USD both ways. So, we decided to remain on the sidelines.
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