Hi Traders! GBPAUD forecast follow up and update is here. On February 16th I shared this “GBPAUD Forecast And Technical Analysis” post in my blog. In this post, let’s do a recap of this setup and see how it has developed now. If you would like to learn more about the way we trade and the technical analysis we use then check out the Traders Academy Club. Spoiler alert – free memberships are available!
My Idea
On the H4 chart, the price which is moving higher has created a bullish trend pattern in the form of three higher highs, higher lows, we may consider this as evidence of bullish pressure. Generally, after a bullish trend pattern, we may expect corrections and then potential continuation higher. After the bullish trend pattern, we had a correction in the form of double wave down with the price reaching a strong support zone, respected it, and is currently bouncing higher from this zone. We also have a bullish divergence that has formed between the first low that has formed at 1.78127 and the second low that has formed at 1.77789 based on the MACD indicator which we may consider as evidence of bullish pressure. In addition to this, the price which is moving higher has broken above the most recent downtrend line, we may consider this as another evidence of bullish pressure. So everything looks good here for the bulls and until this strong support zone shown in the image below holds I expect the price to continue higher further.
GBPAUD H4(4 Hours) Chart Current Scenario
On the H4 chart, my view was bullish and I was expecting the price to move higher further until the strong support zone holds. After the breakout of the most recent downtrend line, we had a pullback but the price was holding above the strong support zone. The price then moved higher further as I expected delivering 160+ pips move so far.
On the H1 chart, the market provided us with various facts supporting the bullish view. The H4 chart pullback happened in the form of a double wave down on the H1 chart. In addition to this the price has also created a continuing bullish divergence that had formed between the first low that has formed at 1.78740 and the second low that has formed at 1.78499 based on the MACD indicator. Then the price moved higher and broke above the most recent downtrend line, we may consider these as facts provided by the market supporting the bullish view. The price then moved higher further, providing a fantastic move to the upside.
(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)
So, traders, this is why I wanted to show this example to help you understand how important it is to follow the facts. The facts were supporting the bullish view here and there were no signs against it. When the facts do happen as we expected you can see how the price perfectly moved as per the plan. Because these are the kind of hints the market provides us at majority of the times and it’s our obligation as traders to be able to listen to these things that the market tells us and we should try to make the right actions.
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To your success,
Vladimir Ribakov
Certified Financial Technician
