Talking Points
GBPAUD at near-term resistance 1.8187 – 1.8200
Broader bias remains weighted to the topside above 1.79
Looking to buy dips/breaks of resistance
Key data prints out of Australia & UK over the next 24hours
GBPAUD Daily Chart
Chart Created Using FXCM Marketscope 2.0
Technical Outlook
GBPAUD tags key resistance at 1.8187 – 1.8200
Topside breach targets 2010 high at 1.8280, 1.8567, 1.8812
Interim support 1.8060, 1.7984 / 1.8000- Scalp bias bullish above this mark
Broader bias constructive above 1.79- bullish Invalidation
Daily RSI in overbought (bullish)-Multiple support triggers/70-break to signal correction
Key Events Ahead: Australia Trade Balance tonight and BoE Interest Rate Decision Tomorrow
GBPAUD Scalp Chart
Notes: This pair has been extremely popular in DailyFX on Demand and ahead of major US event risk I thought it prudent to highlight this long-range scalp. Last month’s break above technical resistance at 1.7470 shifted our focus higher and while our broader bias remains weighted to the topside, the pair has now come into a key near-term resistance range between 1.8187 and the 1.82 figure. Aggressive players will be attempting shorts against this threshold while conservative traders will be looking for fresh long entries lower down.
The pair has continued to trade within a well-defined ascending channel formation dating back to November 27th and it’s worth noting that topside breaches of these types of structures can often be the steepest/sharpest part of the trend. The initial weekly & monthly opening range looks to have been compromised to the topside and as such offer further conviction on our directional bias. We will utilize the 1.8060 level as the opening range high with the level representing favorable long-side entries.
Near-term momentum does risk a pullback here with an intra-day support trigger set as we head into event risk from Australia tonight and the BoE interest rate decisions tomorrow morning. Note that the daily average true range on the pair is rather wide with a quarter of the ATR coming in at 44pips. Although the scalp targets are much larger, it’s important to remain prudent as we open up the month with a portion of the trade to be booked & stops brought to break-even upon achieving the objective range.
* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.
Key Threshold Grid
Entry/Exit Targets
Timeframe
Level
Significance
Bearish Invalidation
Daily / 30min
1.8187 – 1.8200
1.618% & 50% Exts / TL Resistance
Break Target 1
Daily / 30min
1.8280
2010 High / Soft Resistance
Break Target 2
Daily / 30min
1.8360
Soft Resistance / Pivot
Break Target 3
Daily /30min
1.84
Big Figure / Psychological Level
Break Target 4
Daily / 30min
1.8460
Soft Resistance / Pivot
Break Target 5
Daily / 30min
1.8567
1.618% Fib Extension
Support Target 1
30min
1.8100
Big Figure / Psychological Level
Support Target 2
Daily / 30min
1.8060
Weekly Opening Range / November High
Support Target 3
Daily / 30min
1.7984 – 1.8000
1.618% & 100% Extensions
Bullish Invalidation
Daily / 30min
1.7900
Dec Range Low / Channel Support
Break Target 1
Daily / 30min
1.7835
38.2% Extension
Break Target 2
30min
1.7564
Nov 25th Weekly Low
Break Target 3
30min
1.7470
61.8% Extension
Average True Range
Daily
174
Profit Targets 43-46pips
Other Setups in Play:
EURNZD Scalps Eye Weekly Opening Range- Bullish Above 1.6360
Scalping EURAUD Pullbacks- Bias Bullish Above 1.4480
USDCAD Scalps Target Topside Objectives- Bullish Above 1.04
—Written by Michael Boutros, Currency Strategist with DailyFX
For updates on this scalp and more setups follow him on Twitter @MBForex
To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list
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Source: Daily fx