Hi Traders! GBPAUD short term forecast and technical analysis is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. 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! Let’s start our analysis from the highest timeframe which will be the daily chart here.
GBPAUD D1(Daily) Chart Analysis – Bearish Convergence, Key Support Zone
On the daily chart, after the strong bullish move currently it looks like a correction is happening. Also, we have a bearish divergence that has formed between the first high that has formed at 1.89712 and the second high that has formed at 1.91531 based on the MACD indicator. The price then moved lower and broke below the last low at 1.87531 thus forming a classical setup of bearish divergence followed by bearish convergence, we may consider these as evidences of bearish pressure. Generally, after a bearish convergence we may expect corrections and then further continuation lower. Currently it looks like a correction is happening and also we have a key support zone that has formed based on the 38.2%(1.84893) – 50%(1.82843) Fibonacci retracement zones of the strong bullish move. So basically, I expect the price to create one more push lower towards the key support zone after this correction. We may now move down to lower timeframe and look for evidences supporting this short term bearish view.
GBPAUD H4(4 Hours) Chart Analysis – Strong Resistance Zones, Potential Bearish Hidden Divergence, Stochastic Oscillator
On the H4 chart, we had two strong support zones that has formed and the price which is moving lower has broken below these zones and is holding below them, we may consider this as evidence of bearish pressure. Currently, these strong support zones are acting as strong resistance zones for us and the price which is moving higher has reached the first strong resistance zone. We also have a potential bearish hidden divergence that has formed between the first high that has formed at 1.91519 and the second current high at 1.87473 based on the MACD indicator. In addition to this, based on the Stochastic Oscillator we could see that the price has reached its extreme. We may consider these as other evidences of bearish pressure and also there are no signs opposing this bearish view. So based on all this, my short term view here is bearish and I expect the price to move lower further until the two strong resistance zones hold.
Technical Analysis & Forecast Summary
GBPAUD D1(Daily) Chart Analysis
- Bearish Convergence, Key Support Zone
GBPAUD H4(4 Hours) Chart Analysis
- Strong Resistance Zones, Potential Bearish Hidden Divergence, Stochastic Oscillator
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short term sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team.
