Pound warriors assemble!
GBP/AUD bears have had the hot hand for the past few months, recently demonstrated by the strong break in the descending triangle marked above.
But the action has cooled recently with the pair now converging just under the 100 SMA around the 1.7800 handle.
Action could pick up again soon with the end of year quickly approaching, and if the rally continues, will see the bears take shots once again at the falling moving averages and broken triangle support?
GBP/NZD is also solidly in the hands of the bears, and much like GBP/AUD, the past week hasn’t been too kind to them.
The recent rallies have brought the market up to several technical arguments for bears to jump back in again: the falling ‘highs’ pattern and the falling moving averages.
It’s clear that in the recent past that these patterns have brought in sellers successfully, so the question is now, “will the bears take control once again?
The patterns clearly shout a resounding “yes!”, but try not to get too excited about shorting just yet with the uncertainty of Brexit still in play.
Wait for the market to confirm the resistance by moving lower before working on the next play to play the trend lower!