AUD/SGD 1H Chart: Channel Down

The Australian Dollar is trading against the Singapore Dollar in a short-term descending channel, which consists of four reaction highs and three reaction lows and, thus, might be broken already by the end of the week. Historically, the currency rate made multiple attempts to break to the top. However, each time these endeavours were stopped by a combination of the 55-, 100- and 200-hour SMAs. The fact that this pair is so sensitive to the above moving averages suggests that a breakout in the northern direction is unlikely to happen. Moreover, channels are continuation patterns and, thus, should not change a recently established general downtrend. The above assumption is additionally supported by the fact that 73% of traders hold short positions on this currency pair.