GBPAUD closes higher for the 2nd day in a row
British Pound/Australian Dollar (GBPAUD) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, GBPAUD finished the week 0.65% higher at 1.9433 after gaining 24 pips (0.12%) today on low volume. Trading up to 59 pips lower after the open, the FX pair managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on January 29th, GBPAUD gained 1.05% on the following trading day. Closing above Thursday's high at 1.9430, the currency confirmed its breakout through the previous session high after trading up to 14 pips above it intraday.
Daily Candlestick Chart (GBPAUD as at Feb 14, 2020):
Friday's trading range has been 92 pips (0.47%), that's far below the last trading month's daily average range of 171 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GBPAUD.
After trading down to 1.9352 earlier during the day, GBP/AUD bounced off the key technical support level at 1.9390 (S1). The failure to close below the support could increase that levels significance as support going forward. After having been unable to move above 1.9430 in the prior session, the forex pair ran into sellers again around the same price level today, failing to move higher than 1.9444.
While the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
With prices trading close to this year's high at 1.9756, upside momentum could accelerate should the pair be able to break out to new highs for the year.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for GBP/AUD. Out of 672 times, GBPAUD closed higher 52.23% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 54.32% with an average market move of 0.10%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are USDCAD losing -0.12% and EURUSD closing -0.08% lower. On the flipside the best performers have been USDCHF closing 0.28% higher and GBPUSD gaining 0.02%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDSEK surging 0.51% and EURSEK closing 0.43% higher. The worst performers of the day have been EURHUF tanking -0.65% and USDHUF closing -0.58% lower. Read more