The buyers and sellers in the AUDUSD continue to fight it out near the 100 (blue line in chart above) and 200 day MA (green line). For 8 of the last 9 trading days, the price has touched at least one of the MA levels. Over that time period, the 100 day MA crossed below the 200 day MA (bearish). The price today moved above the 100 and 200 day MA but there is a risk the price closes below both MA levels (below 1.02355). This too would give a slight bearish bias on the failure to break back higher today.
Looking at the hourly chart, the price is back below the 200 hour MA and is looking to break back below the 100 hour MA (blue line) at 1.0218. A move and close below this level, should open the door for a test of the trend line support at the 1.0188 level (connects low from June 1 and June 28th). A move below this trend line starts to build the case for a more substantial correction lower in the pair.
Another related pair to consider is the EURAUD. The AUDUSD has been supported by the steady decline in the EURAUD. That pair traded to new all time lows for the pair today – accelerating below trend line support in the process. The way I see it, if the price of the EURAUD can bottom and get above the 1.1970-87 area (above trend line and low from yesterday), a correction lower in the AUDUSD can gain momentum. WIthout such a move, the bears remain in control of the trend. Ultimately, a move above the 100 hour MA (blue line in the chart below) at the 1.2036 currently, would be needed to convince or scare the shorts in the pair. The price has not closed above the 100 hour MA since June 26th. It has not closed above the 200 hour MA (green line) since June 5th! That defines a trend and it also defines when a trend may be over too. When the price closes above each, and the price stays above each, is when the buyers and sellers are more balanced. Until then, longs remain scared and short are not.
