We are executing an Elliott wave trade, the risk-off market sentiment leans in favour of a bearish AUD. The Elliott wave count also aligns with the current fundamental environment. The AUD, NZD and CAD are generally faced with selling pressure during a risk-off market sentiment. We will enter on a BUY stop at the short term resistance level. There is a bullish invalidation level at the wave (i) top at 1.7425.
GBPAUD – Daily Chart
A completed 5 wave decline on the GBPAUD daily chart has taken place. This will lead to a minimum 3 wave corrective rally.
GBPAUD – 4 Hour Chart
GBPAUD – 15 Minute Chart
The wave C corrective rally has only created 4 waves, leaving us to assume a final 5th wave bullish run to the upside is yet to unfold. We are waiting for a breakout above the negative trend line resistance on the 15 minute chart before going long.
Trade Setup: BUY STOP, entry price 1.7687, stop loss 1.7567 and take profit 1.7887
Stop loss: 120 pips
Take profit: 200 pips