On the daily timeframe, GBP/AUD could be forming a double bottom near 1.7500 psychological support. Price has spiked down, below the previously established low at 1.7489, and tested the 1.7424, which is the lowest price since the beginning of this year. Nonetheless, the daily closing price remained above the 1.7489 support, suggesting the double bottom formation.
The 1.7500 could be playing a key role in a long-term price development because as long this support area is being respected, there is a high probability that GBP/AUD will be heading towards the 1.8300 resistance area. It can be seen that price has formed a range zone, as it continues to consolidate between 1.7500 support and 1.8400 resistance area.
Keeping in mind that the consolidation phase could be ongoing, GBP/AUD is likely to be moving towards the top of the range. Perhaps it will not reach the highest point, but the price can rise towards the 1.8280 resistance area. At this price area, there are two Fibonacci retracement levels, as can be seen on the chart. The first is 23.6% Fibs applied to the overall downtrend, which took place between March 2019 - September 2020. The second is the 88.6% Fibs applied to the last wave down, which occurred between August-September 2020.
Therefore, as long as the recently printed low is being respected, GBP/AUD could be rigging by 500-600 pips. On the other hand, if 1.7424 is broken, the downtrend continuation will become the most probable scenario, and the bullish outlook will be immediately invalidated.
Key support levels: 1.7424, 1.8284
Key resistance levels: 1.8030
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Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.
The 1.7500 could be playing a key role in a long-term price development because as long this support area is being respected, there is a high probability that GBP/AUD will be heading towards the 1.8300 resistance area. It can be seen that price has formed a range zone, as it continues to consolidate between 1.7500 support and 1.8400 resistance area.
Keeping in mind that the consolidation phase could be ongoing, GBP/AUD is likely to be moving towards the top of the range. Perhaps it will not reach the highest point, but the price can rise towards the 1.8280 resistance area. At this price area, there are two Fibonacci retracement levels, as can be seen on the chart. The first is 23.6% Fibs applied to the overall downtrend, which took place between March 2019 - September 2020. The second is the 88.6% Fibs applied to the last wave down, which occurred between August-September 2020.
Therefore, as long as the recently printed low is being respected, GBP/AUD could be rigging by 500-600 pips. On the other hand, if 1.7424 is broken, the downtrend continuation will become the most probable scenario, and the bullish outlook will be immediately invalidated.
Key support levels: 1.7424, 1.8284
Key resistance levels: 1.8030
Thanks for your support! If you liked this analysis, please support our profile with a 👍 and follow us to get a new daily analysis.
Disclaimer: The analysis presented in this article is for educational purposes only and should not be considered as financial advice.