GBPAUD Short Term Forecast Follow Up And Update

Hi Traders! GBPAUD short term forecast follow up and update is here. On February 2nd I shared this “GBPAUD Technical Analysis And Short Term Forecast” post in our 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 H1 chart, the price which is moving lower has created a double wave down. We also have a bullish divergence that has formed between the first low that has formed at 1.89851 and the second low that has formed at 1.89284 based on the MACD indicator which we may consider as evidence of bullish pressure. Also, this bullish divergence supports the H4 bullish hidden divergence which we may consider as another evidence of bullish pressure. 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. Also, we have two key support zones that has formed, the first key support zone is formed by the 61.8%(1.89628) Fibonacci expansion level of the first wave. The second key support zone is formed by the 100%(1.88758) Fibonacci expansion level of the first wave. Until both these key support zones hold my short term view remains bullish here. If we get a valid breakout above the downtrend line shown in the image below we may then consider it as a validation for this bullish view and may expect the price to move higher further.

 

GBPAUD H1(1 Hour) Chart Current Scenario

Based on the above-mentioned analysis my short term view was bullish here and I was expecting the price to move higher further until the two key support zones hold. Also, I mentioned that “If we get a valid breakout above the most recent downtrend line we may then consider it as a validation for this bullish view and may expect the price to move higher further”. The price action followed my analysis exactly as I expected it to here, the validation for the bullish view which is a valid breakout above the downtrend line happened and then the price moved higher further and delivered around 200 pips move.

(Note: You can learn about a Killer Forex Strategy “Double Trend Line Principle” here)

We had various facts supporting the bullish view here. The price respected the first key support zone and also we had a bullish divergence between the first low that has formed at 1.89851 and the second low that has formed at 1.89284 based on the MACD indicator. The price then moved higher and broke above the most recent downtrend line. We may consider these as facts provided by the market supporting the bullish view. And, also there were no signs opposing this bullish view. Then as you can see in the image above how the price moved higher further and provided a nice move to the upside!

So traders, when it comes to trading, there are various important factors that we need to pay attention to, just because we have a good setup doesn’t mean that we can enter the trade randomly and it will pay us huge profits. First of all, we need to validate the entry and we should have a perfect entry plan to get into the trade which is a key factor when it comes to trading. This GBPAUD forecast is yet another good example of this scenario.

 

Happy Trading!

Arvinth Akash
Traders Academy Club Team