Sellers Remain in Charge in AUD/USD, As Long As MAs Stay Above
[[AUD/USD]] turned pretty bullish in October. That was due to a few factors. The US manufacturing sector fell deeper into contraction last month, while a partial trade deal was announced between US and China, which improved the sentiment. The Aussie benefited from it, as a risk currency.
But, the sentiment reversed this month and AUD/USD turned bearish after having gained around 250 pips in October. The price broke above all moving averages without much resistance from them, which is a sign that the buyers had given up and were booking profit on their long positions.
The 50 SMA (yellow) turned into resistance immediately after being broken, which was another sign that sellers were in control. So far, this pair has lost around 140 pips from top to bottom and the picture looks pretty bearish. At the end of last week, we saw a retrace higher, but the 50 SMA and the 100 SMA (green) provided solid resistance, reversing AUD/USD lower.
So, sellers are in control here and despite Trump’s comments late last week that the Phase One deal is almost complete, the Aussie can’t seem to find the strength for a bullish reversal. This is another sign which points down. We are already short on this pair, so we’re holding on to our trade.
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