The AUDUSD is lower on the day. The declines were helped by the lower-than-expected CPI data out of Australia last night. That sent the pair down to a low of 0.67287. However, that low fell just short of the rising 200-day moving average of 0.67222 (see lower green line in the chart below).
Recall from Monday’s trade, the price briefly moved below the 200-day moving average only to reverse back to the upside quickly. The last 4 moves lower have found early buyers against the rising 200-day moving average over the last 3 trading days.
The bounce off of that low took the price back above its 100-hour moving average (blue line in the chart below) at 0.67579, but sellers once again reentered and the price for the GBPUSD has stayed below the 100-hour moving average over the last 7 or so hourly bars. Bearish.
After running back down to test the low of the day (and finding early buyers once again), the price has rebounded on the last hourly bar back toward the 100-hour moving average at 0.67579. The current price trades at 0.6746.
Overall, with a price below the 100 and 200-hour moving averages, the bias shift is to the downside. What would change that bias?
The 100-hour moving average is at 0.67579. The 200-hour moving average is falling and currently is at 0.67855. Through the FOMC rate decision, getting above both is needed to increase the buyer’s control and would shift the bias more in the favor of the buyers.
Of course, the price is still below both those moving averages which gives the sellers the advantage. On the downside, however, getting below the rising 200-day moving average of 0.67222 and the low from Monday at 0.67143 would be needed to increase the bearish bias and have traders looking toward the 100-day moving average at 0.6690. Ultimately getting below those longer-term moving average target levels would not only shift the bias firmly in the seller’s favor, but increase the bearish bias from a longer-term perspective.
This article was written by Greg Michalowski at www.forexlive.com. Source