Trading opportunities for currency pair: a strong support from which the GBP/AUD managed to return to 2.0889 has formed. I’ll take a risk in saying that there’ll be growth to 2.13. Any growth above 2.1046 should tell you to hold off selling. A break through 2.0730 will see the rate drop to the trend line at 2.0525.

Background:

The last GBP/AUD idea I made came out on 14th September. The rate at that time was 2.1750. In September I looked at two scenarios. The first was a rebound (sticking basically with the trend) and the second was for if a break in the trend was to take place. In actual fact, the GBP/AUD broke the trend line and after a recoil the pound reached the calculated 2.0913 level (23.6% 1.8979 – 2.1528).

As things are at the moment:

Since August a support (2.0730-2.0873) has been forming. The support is strong. If we make a line along the minimums, we can see a formation that comes together. We now need to set out what we expect from the pair in December.

All trader attention is now on the ECB and FOMC meetings, along with the NFP that is on the horizon. For this cross it’s more important how the pound and the Aussie act against the USD. At the moment, we can look at setting buy stops below 2.0730 as well as pound sales if there’s a break in the support.

The potential for a strengthening of the pound is significantly higher than the potential for a weakening of the currency. If we see a bounce of the price from the support, we can set our eyes on 2.13 and if we see this break then we’ll be looking to 2.0525. I reckon that a fall in the pound will hold the main trend line from the 1.7212 (8th September, 2014) minimum – 1.8979 (6th May, 2015).

Last week saw representatives of the Bank of England, in addition to UK stats, disappoint the buyers. However, whilst the support isn’t broken, we better work with a rebound. A growth above 2.1046 should make you more than think twice about selling.

GBPAUD

Forecasts which are made in the review constitute the personal view of the author. Commentaries made do not constitute trade recommendations or guidance for working on financial markets. Alpari bears no responsibility whatsoever for any possible losses (or other forms of damage), whether direct or indirect, which may occur in case of using material published in the review

Recommended Content


Recommended Content

Editors’ Picks

AUD/USD recovers above 0.6750 after Australian jobs data

AUD/USD recovers above 0.6750 after Australian jobs data

AUD/USD picks up a late bid and recovers above 0.6750 in Asian trading on Thursday, following the release of mixed Australian employment data. The extended post-Fed US Dollar recovery, amid a cautious market mood, could limit the pair's upside ahead of US data. 

AUD/USD News
USD.JPY jumps toward 144.00 on the road to recovery

USD.JPY jumps toward 144.00 on the road to recovery

USD/JPY gains traction and approaches 144.00 in Thursday's Asian session. The uptick of the pair is bolstered by the impressive US Dollar recovery. Investors shift their attention to the US data and the Bank of Japan interest rate decision on Friday. 

USD/JPY News
Gold price remains on the defensive amid the post-FOMC USD recovery from YTD low

Gold price remains on the defensive amid the post-FOMC USD recovery from YTD low

Gold price struggles to lure buyers despite the Fed’s jumbo interest rate cut on Wednesday. A further recovery in the US bond yields underpins the USD and caps the non-yielding metal. Concerns about an economic slowdown, along with geopolitical risks, help limit the downside.

Gold News
Ethereum attempts recovery following first rate cut in four years

Ethereum attempts recovery following first rate cut in four years

Ethereum is trading above $2,330 on Wednesday as the market is recovering following the Federal Reserve's decision to cut interest rates by 50 basis points. Meanwhile, Ethereum exchange-traded funds recorded $15.1 million in outflows.

Read more
Australian Unemployment Rate expected to hold steady at 4.2% in August

Australian Unemployment Rate expected to hold steady at 4.2% in August

The Australian Bureau of Statistics will release the monthly employment report at 1:30 GMT on Thursday. The country is expected to have added 25K new positions in August, while the Unemployment Rate is foreseen to remain steady at 4.2%.

Read more
Moneta Markets review 2024: All you need to know

Moneta Markets review 2024: All you need to know

VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.

Read More

Majors

Cryptocurrencies

Signatures