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 – Key Support Zone, Bullish Divergence, Engulfing Candle Pattern, Stochastic Oscillator
On the daily chart, after the strong bullish move currently it looks like a correction is happening and the price which is moving lower has reached a strong support zone. While measuring the big bullish move using the Fibonacci retracement tool we could see that the 50%(1.82843) – 61.8%(1.80793) Fibonacci retracement zones coincides with the strong support zone which makes this area a key support zone for us. Also, we have a bullish divergence that has formed between the first low that has formed at 1.85300 and the second low that has formed at 1.81262 based on the MACD indicator which we may consider as evidence of bullish pressure. In addition to this, we also have a bullish engulfing candle pattern that has formed which we may consider as another evidence of bullish pressure. Also, based on the Stochastic Oscillator we could see that the price has reached it’s extreme which we may consider as yet another evidence of bullish pressure. We may now move down to lower timeframe and look for evidences supporting this short term bullish view.
GBPAUD H1(1 Hour) Chart Analysis – Bullish Convergence, ADX Indicator
On the H1 chart, the price which was moving lower has reached a strong support zone, respected it and bounced higher from this zone. Also, we had a bullish divergence that has formed between the first low that has formed at 1.81849 and the second low that has formed at 1.81262 based on the MACD indicator. Then the price moved higher and broke above the last high at 1.82373 creating higher highs, thus forming a classical setup of bullish divergence followed by bullish convergence. Hence as per the book scenario, after a bullish convergence, we may look for corrections to happen and then further continuation to the upside. Currently it looks like a correction is happening. In addition to this, the ADX indicator gave a bullish signal here at the cross of +DI (green line) versus -DI (red line) and the main signal line (silver line) reads value over 25, we may consider this as yet another evidence of bullish pressure. So everything looks good here for the bulls and until the strong support zone shown in the image below holds, I expect the price to move higher further after pullbacks.
Technical Analysis & Forecast Summary
GBPAUD D1(Daily) Chart Analysis
- Key Support Zone, Bullish Divergence, Engulfing Candle Pattern, Stochastic Oscillator
GBPAUD H1(1 Hour) Chart Analysis
- Bullish Convergence, ADX Indicator
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 buy setup then you can use any setup and strategy that you have in your arsenal to look for bullish moves and join this buy trade.
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Happy Trading!
Arvinth Akash
Traders Academy Club Team
