Hi Traders! GBPAUD forecast follow up and update is here. On February 3rd I shared this “GBPAUD Forecast AndTechnical 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. Currently, it looks like a correction is happening. Also based on the Stochastic Oscillator we could see that the price has reached its extreme. We may consider this as yet another evidence of bullish pressure. Until the key support zone formed by the 50%(1.77161) – 61.8%(1.76456) Fibonacci retracement zones of the bullish trend pattern holds my view remains bullish here and I expect the price to move higher further.
GBPAUD H4(4 Hours) Chart Current Scenario
Based on the above-mentioned analysis my view was bullish here and I was expecting the price to move higher further after pullbacks. The pullback that I was looking for happened but the price was holding above the strong support zone. In addition to this, we had a bullish hidden divergence that had formed between the first low that has formed on 20th January 2021 and the second low that has formed on 4th February 2021 based on the MACD indicator which we may consider as a fact provided by the market supporting the bullish view. Also on the H1 chart, this pullback happened in the form of double wave down with the price creating a continuing bullish divergence between the first low that had formed on 3rd February 2021 and the second low that has formed on 4th February 2021 which we may consider as another fact provided by the market supporting the bullish view. The price then moved higher as I expected and delivered 230+ pips move until it was blocked by a bearish divergence on the H4 chart.
GBPAUD H1(1 Hour) Chart
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
