GBPAUD closes higher for the 7th day in a row
British Pound/Australian Dollar (GBPAUD) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 7th day in a row, GBPAUD ended the month 1.98% higher at 1.8320 after surging 119 pips (0.65%) today on high volume. Today's close at 1.8320 marks the highest recorded closing price since June 11th. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (GBPAUD as at Jul 31, 2020):
Friday's trading range has been 182 pips (1.0%), that's above the last trading month's daily average range of 138 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GBPAUD.
One bullish candlestick pattern matches today's price action, the White Candle.
After having been unable to move above 1.8338 in the prior session, the market ran into sellers again around the same price level today, missing to move higher than 1.8360. The last time this happened on Wednesday, GBPAUD actually gained 0.66% on the following trading day.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day although could signal a potential change in momentum that might lead to a correction back down towards the center of the Bollinger Bands at 1.8035.
Though the FX pair is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "7 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for GBP/AUD. Out of 8 times, GBPAUD closed higher 75.00% 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 75.00% with an average market move of 0.61%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are NZDUSD losing -1.04% and AUDUSD closing -0.72% lower. On the flipside the best performers have been USDJPY closing 1.12% higher and USDCHF gaining 0.48%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDZAR surging 1.87% and GBPZAR closing 1.79% higher. The worst performers of the day have been NZDCAD tanking -1.15% and NZDHKD closing -1.05% lower. Read more