Trade of the Day: GBP/AUD

By: Dima Chernovolov

GBP/AUD recently reversed up from the lower trendline of the daily Down Channel chart pattern which was previously identified by Autochartist. Autochartist rates the quality of this Down Channel at the 7-bar level – which is the result of the sharp Initial Trend (10 bars), lower (2 bars) and significant Clarity (7 bars). GBP/AUD is expected to rise further inside this Down Channel – in line with the earlier upward reversal from the key support area shown below.

As can be seen from the daily GBP/AUD chart below, the pair recently reversed up from the support area lying between the pivotal support level 1.8100 (which also stopped the previous sharp downward correction in April), lower daily Bollinger Band and the 50% Fibonacci correction of the previous upward impulse from September. The proximity of this support area increases the probability GBP/AUD will continue to rise inside this Down Channel.