Welcome to a fresh trading week, brothas! Hit the ground running with these hot setups on GBP/USD and GBP/AUD!
First up is a nice and simple trend play on GBP/AUD. After finding support near the 1.6600 previous low, the pair has shot back up to the 1.6750 minor psychological handle.
What makes the retracement interesting is that it lines up with not only a 38.2% Fibonacci retracement but also a falling trend line resistance near the 100 SMA on the 1-hour time frame.
Think the pound will extend its short-term downtrend against the Aussie? Selling at the earliest signs of downside momentum could still get you decent pips especially if you think that the pair will head for its 2017 lows.
On the other hand, a break above said resistance levels could take the pair back to the 1.6900 area of interest or even the previous highs near 1.7100. Watch this one closely, will ya?
Breakout alert! In case you missed it, Cable has FINALLY broken above the closely-watched 1.3000 major psychological handle last week. Question is, are we looking at a breakout? Or is this a major fakeout in the making?
As the School of Pipsology tells us, triangle breakouts like these tend to be as strong as the base of the triangle. In this case, we’re looking at a rough 800-pip move.
Aggressive bulls can pounce at market prices and bet on the pound revisiting its highs near 1.3350. If you’re one of them conservative traders, however, then you could also wait for a bit of retracement and a bounce to confirm the breakout.
But if you think that we’re actually lookin’ at a fakeout, then you might want to keep close tabs until the pair returns to its ascending triangle. In any case, make sure you place wide stops when trading higher time frames like these!