GBP/AUD Trades in Neutral Grounds
|GBP/AUD traded slightly higher today, after it hit support near the psychological zone of 1.8000 yesterday. That said, the recovery was halted near the 1.8085 level, from which the rate started pulling back again. Although GBP/AUD remains above the uptrend line taken from the low of December 3rd, it is also trading below a downside resistance line drawn from the high of January 24th, which suggests weakness among the bulls to aim for higher highs. Thus, having all this in mind, we prefer to remain sidelined for now and wait for a decisive break of one of those two lines.
A clear and decisive dip below the aforementioned uptrend line could also place the rate below the psychological hurdle of 1.8000. Such a move may encourage the bears to aim for the 1.7880 area, which is near the lows of February 5th and 6th. Another dip below that zone would confirm a forthcoming lower low on the daily chart and may carry bearish extensions towards our next support zone, at around 1.7780.
Taking a look at our short-term oscillators, we see that the RSI rebounded from near 30, but turned down again from near 50. The MACD, although negative, has bottomed and now lies near its trigger line. These mixed momentum signals add more credence to our choice to stand on the sidelines for now and wait for clearer directional signs.
On the upside, we would like to see a clear break above 1.8200, as well as above the downside line taken from the high of January 24th, before we start examining the positive case. This could hint that the bulls are gaining back some of their recently lost strength and could pave the way for the 1.8315 territory. Another break, above 1.8315, may allow the rally to extend towards the 1.8410 area.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.