UPDATED TRADE – Please check the newest chart analysis below
Good afternoon Forex Kings,
Today we are looking at the GBPAUD, this technically looks like a great trade set up in terms of risk to reward.
Markets are recovering from the major sell off from last week. The AUD has been oversold against all major currencies. We may see a some strength return to the commodity related currencies as central banks will step in to protect global financial markets.
Tomorrow we see the RBA take centre stage as they provide their next interest rate decision at 2:30pm, however entry wise we feel it could be beneficial to enter a position prior to the announcement. It is expected that the RBA will keep interest rates on hold, therefore this could also provide strength into the AUD.
GBPAUD – Technical Analysis
GBPAUD – Monthly Charts
On the monthly charts the GBPAUD has created a hang man candle. This is a very strong signal a reversal may occur when found at the top of a trend. As you can see this candle has resulted in large reversals previously, the fundamentals may also support this reversal if the RBA hold interest rates tomorrow.
GBPAUD – Daily Time Frame
Daily charts are signalling a bearish divergence on the RSI. Target levels for take profits can be found at 1.9380, 1.9170 and 1.8950.
GBPAUD – 1 Hour Charts – Updated 4th March
Trade SET UP: SELL LIMIT (1.9490), stop loss set at 1.9570 and take profit left open to run, but targeting at least the 1.9200 level.
Stop Loss: 80 PIPS
Take Profit: 290 PIPS