Ticker tape by TradingView

Want to see our trades?

See all of our entries, exits, and analysis. Use code READER for 25% OFF!
Learn More about VIP

GBP/AUD Deep Dive: Break or Range?

Looking at the overall trend on GBPAUD, since the heavy drop from 5-Year highs in March 2020, price has been consolidating between 1.74 and 1.85. We can see price moving back and forth between these levels and price not making any significant moves or breaks. That being said, it is still a 1100 pip range, and so it is definitely beneficial to get in during this ranging phase.

Zooming in on GBPAUD, price broke out of a descending triangle in the opposite direction, to the upside. And since then it's created an EQL at 1.779 and collecting orders from the Order Block (OB) at 1.81-1.822. We can see price is just about collecting these orders from the 0% mark in the OB and making swift moves to the downside, towards the EQL.

Unless new signs of a breakout or a break of this consolidating trend form, I will be looking to get in on this repeated event, enter at the OB and look for targets at the EQL, then trail my stop loss and take profits lower once we see price reaches the initial target.

Moving on from technicals, so far in 2021, both the GBP and the AUD are included in the best performing G10 currencies. The Pound appeared to gain on the bad start to the year after leaving the EU. However, this is now switched to relative vaccination rates, with the UK delivering one of the fastest paces of vaccine rollout.

Another potential driver which favours the Pound are the 2-year swap spreads, the difference between interest rates on offer in the UK and Australia. The BoE said it did not envisage cutting interest rates to 0% or less given expectations for a rebound in the UK economy. This has allowed the yield paid on UK bonds to rise relative tot hose in other countries, which is supportive of the Pound.

Early March we had news of a fresh record high in Australia's trade surplus, reported by the ABS that trade surplus in Goods and Services hit A$10.1B in January, representing a A$3B improvement on December. The main driver for the boost was solid demand for raw materials from China. Demand for these raw materials could find support for the AUD over the next coming months.

view retail sentiment data here

Retail Sentiment data shows most traders are long on GBPAUD currently, but sellers aren't too far off at 40% and therefore showing it's quite mixed at the moment.

Get Alerts every time we take a trade!

Join The VIP Community!

Our entries, exits, & analysis
Live webinar coaching calls
Trading chatrooms
Strategy library
Use Code "READER" for $5 OFF!
Join Now

Need a Better Broker?

Impeding Correction In The Equities Markets?

9/17/2021 Stocks are down -0.58% this morning after coming down to test a significant level of support once again. While stocks fall, the dollar rises in the anticipation of sooner-than-expected tapering by the Fed along with a hike in interest rates starting in 2022. Our outlook Other than September being one of the worst months […]

Read More
EURUSD- Is It Now Time To Sell This Pair?

9/16/2021 The Euro-Dollar pair is down over 0.5% today after several days in the red. Today's speech by EU president Lagarde mentioned how the economic recovery had come quicker than expected six months ago. This was praised by the prompt vaccine distribution so citizens could get back to work. Across the pond, the US just […]

Read More
What To Make Of The Latest CPI News

9/14/2021 This morning's report on CPI m/m and core CPI m/m came in at a lower percentage than expected which resulted in a falling dollar pre-New York session. The USD is now volatile under the uncertainty of potential tapering and rising rates while the equities market seems to be rising because of this. Our outlook […]

Read More
Institutions Dumped The Buck- How To Trade This

9/13/2021 Big money has been moving out of Australia's currency for nearly a month now which has been the biggest drop in long contracts in this amount of time year-to-date. Australia's dollar index (AXY) is up 0.06% at 73.61 on the day after rebounding from the lows around 71.19. Our outlook Australia's economy has surprised […]

Read More
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here

A1 Trading Company

A1 Trading Company is a financial services and media business founded in Atlanta, USA.
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram