GBP/AUD: Resistance on Previous Support?

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GBP/AUD Daily

GBP/AUD Daily

The Aussie’s advances against the pound were cut short following the disappointing reports on the Australian jobs market released on Wednesday evening. On the four-hour time frame, we see that GBP/AUD retreated from its low at 1.7975 and rallied back up to 1.8161.

On the technical side of the trade, the Aussie could still resume its dominance against the pound though. The area where it is currently trading right now, 1.8160, is a major area of interest. GBP/AUD found resistance on the level in June and July 2014. It also served as support for the pair mid-July too!

To top it off, the area also coincides nicely with the 100 SMA on the 4-hour time frame which makes it an even formidable resistance level.

But of course, with more top-tier events that could rock the markets, there’s an equal chance for GBP/AUD to trade past the resistance level too. If you plan on trading the pair, be on your toes for candlesticks in the area. Reversal candles in the form of dojis could mean that GBP/AUD may soon be on its way to test support around 1.8000. On the other hand, a bullish marubozu above the resistance level may mean that we would soon see the currency pair trade around the highs for July 15 at 1.8350.

To contact the reporter of this story; Jonathan Millet at john@forexminute.com

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