GBP/AUD trade idea: How to play the long term trend decelerating lower

Introduction

VolatilityMarkets suggests top quant trade ideas to take advantage of trending markets.

Market summary

GBPAUD last price was £ 1.734792. In the short term GBPAUD has been negatively accelerating higher. In the long term GBPAUD has been decelerating lower. Over the past 20 days, the GBPAUD price increased 7 days and decreased 13 days. For every up day, there were 1.86 down days. The average return on days where the price increased is 0.3388% The average return on days where the price decreased is -0.4338% Over the past 20 Days, the price has decreased by -3.24% percent. Over the past 20 days, the average return per day has been -0.162% percent. With the long term trend being the stronger of the two, we propose a short trade idea with an overnight time horizon.

The trade idea

Sell £ 463,766 GBP, or 4.64 lots of GBPAUD, take profit at £ 1.7311 level with 50.0% odds for a £ 999 GBP gain, stop out at £ 1.7385 with 50.0% odds for a £ 1,000 GBP loss through O/N time horizon.

Intraday Predictions

GBP/AUD trend analysis

GBPAUD last price was £ 1.734792. The long term trend decelerating lower is stronger than the short term trend negatively accelerating higher. This trade goes short when the price was moving lower and decelerating over the past 20 days.

GBP/AUD value analysis

Over the past 20 days, the GBPAUD price increased 7 days and decreased 13 days. For every up day, there were 1.86 down days. The average return on days where the price increased is 0.3388% The average return on days where the price decreased is -0.4338% Over the past 20 Days, the price has decreased by -3.24% percent. Over the past 20 days, the average return per day has been -0.162% percent.

GBP/AUD worst/best case scenario analysis

Within 1 week, our worst case scenario where we are 95% certain that this level won't trade for GBPAUD, is £ 1.723895 , and the best case scenario overnight is £ 1.745689 . levels outside of this range are unlikely, but still possible, to trade. We are 50% confident that £ 1.7385 could trade and that £ 1.7311 could trade. These levels are within statistical probability.

Key Takeaways:

• Price today £ 1.734792

• Over the past 20 days, the GBPAUD price increased 7 days and decreased 13 Days.

• For every up day, there were 1.86 down days.

• The average return on days where the price increased is 0.3388%.

• The average return on days where the price decreased is -0.4338%.

• Over the past 20 Days, the price has decreased by -3.24% percent.

• Over the past 20 days, the average return per day has been -0.162% percent.

• Over the past 20 days, The price has on average been decelerating: -4.6784 pips per day lower.

• Over the last session, the price increased by 40.36 pips.

• Over the last session, the price increased by 0.2327 %.

• Over the last session, the price decelerated by -109.79 pips.