FX Market Analysis – GBPAUD January 2020

*Live market analysis with trading opportunities on the GBPAUD FX currency pair*

It’s been a while since I gave you a technical chart breakdown on an FX currency pair so in this blog post I am going to analyse the GBPAUD FX currency markets. I will explain what I think price might do over the next few days and weeks and show you my potential trading opportunities.

Let’s get right in to it and look at the daily timeframe chart for GBPAUD.

GBPAUD daily timeframe chart

Over the past 6 months, GBPAUD has been supported by the bullish trendline shown on the chart above and it has continued to make higher lows and higher highs up to the 1.95 level that was tapped in December 2019.

This has been a very bullish time for the currency pair and it now appears we are in a zone where a change in trend could likely occur. The first signs of this was the low that was made around 1.86750 towards the end of December that came right down to near the previous higher lows. This shows a significant swing down in the bullish momentum.

There is also now a lower high that has appeared in the first week of January 2020 that shows a potential for a trend reversal now.

Price is now resting just above the higher timeframe bullish trendline and support zone at 1.86750 and I believe we could now see a test and potential break of those levels. If this was to happen, a 300 pip fall in price could occur and see price taken down to the next support/resistance zone at 1.84.

GBPAUD 4 hour timeframe chart

The 4hr chart shows a few more confluences for a bearish bias. The first is that the most recent bullish lower timeframe trendline was broken this week and it appears that price is now retesting it from below.

Alongside that is the 4hr 50EMA that has been broken and retested so it should now act as a resistance for price when shorting on this intraday timeframe.

You can also clearly see the daily lower high that formed last week vs the yearly all time highs made at 1.95 in December.

I have posted an initial short trade set up on the TradingView platform that incorporates this analysis. You can view the trade set up and track the trade live by clicking on the link below.

https://uk.tradingview.com/chart/GBPAUD/HHK9beC0-GBPAUD-Short-Trade-Momentum-Trend-Continuation/

GBPAUD 4 hour timeframe chart
(with short trade set up)

This first short trade set up implies that the daily trendline will be broken on the next retest of it. The first profit target would be set at the previous daily support with the long term target being 1.84 as shown on the chart above. This is only valid if the first support zone is broken.

The chart below shows a potential scenario for how price might move over the next few days/weeks.

GBPAUD 4 hour timeframe chart
(with price predictions)

If price falls from the current levels then the retest of the higher timeframe bullish trendline could show a little price reaction and bounce. The lower high would be a possible scale in short entry.

If the daily trendline breaks then it is just a case of selling the pullbacks in price and shorting on the lower highs to take advantage of the intraday bearish trend. There is little to hold price up if the daily support is broken so the 1.84 support zone could easily be reached in a matter of days.

The key is patient and to wait for the next trend to establish itself and see if the higher timeframe bullish trend is really going to reverse. That will produce the best trading opportunities for short sellers on GBPAUD.

Useful Links:

All my technical analysis is done using the TradingView platform. You can get access via the link below.

https://tradingview.go2cloud.org/SH3bP

My preferred broker of choice is IC Markets. Low spreads and trading costs really help long term profitability. A link to their site is below.

https://www.icmarkets.com/?camp=38537

FTMO Trader Funding Programme.

https://ftmo.com/?affiliates=335

Thanks for reading and please don’t forget to LIKE, SHARE and FOLLOW my blog to stay up to date with the latest market analysis and trading education posts.

DISCLAIMER: None of the information posted on this site is to be considered investment/financial advice. Trading is high risk and you should only trade with money you can afford to lose.

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