It’s a bit of a slow start to a busy trading week, but I’m hoping Australia’s PMI readings could spark some action for GBP/AUD.
Here’s a simple retracement setup I’m watching.
Before moving on, ICYMI, I’ve listed the potential economic catalysts that you need to watch out for this week. Check them out before you place your first trades today!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
Markets closed in China, Hong Kong and Singapore
BOJ meeting minutes: One dissenter said it was inappropriate to tweak policy target
BOJ: Effect of policy easing will continue even if BOJ widens band around yield target
JP Morgan predicts lower chance of U.S. recession this year
Eurozone consumer confidence index at 3:00 am GMT
U.S. CB leading index at 3:00 am GMT
ECB President Lagarde’s speech at 5:45 am GMT
Australia’s flash manufacturing & services PMIs at 10:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: GBP/AUD
GBP/AUD 1-hour Forex Chart by TradingView
I’m starting this week off with a look at this textbook break-and-retest setup on the hourly chart of GBP/AUD.
There’s not much in the way of top-tier releases for today, after all, so I’m just keeping my fingers crossed for a bit of volatility during Australia’s PMI release.
This pair is already in pullback mode to the area of interest around the 1.7700 major psychological mark, which happens to be right smack in line with the 61.8% Fib.
However, Stochastic is already on the move up to suggest that bullish pressure is in play right now.
A shallow pullback could find enough buyers at current levels near the 38.2% Fib or at the 50% Fib, which is closer to the 100 SMA dynamic inflection point.
Now this faster-moving SMA is above the 200 SMA to confirm that support levels are more likely to hold than to break. In that case, GBP/AUD could make its way back to the swing high at 1.7960 soon.
Apart from Australia’s PMI reports, I’d also keep an eye out for any major swings in risk appetite when trading this one!
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