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GBPAUD Long Scalps Eye Key Resistance- Bullish Above 1.79

GBPAUD Long Scalps Eye Key Resistance- Bullish Above 1.79

2013-12-04 19:12:00
Michael Boutros, Technical Strategist
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Talking Points

  • GBPAUD at near-term resistance 1.8187 – 1.8200
  • Broader bias remains weighted to the topside above 1.79
  • Looking to buy dips/breaks of resistance
  • Key data prints out of Australia & UK over the next 24hours

GBPAUD Daily Chart

Forex_GBPAUD_Long_Scalps_Eye_Key_Resistance-_Bullish_Above_1.79_body_GBPAUD_DAILY.png, GBPAUD Long Scalps Eye Key Resistance- Bullish Above 1.79

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • GBPAUD tags key resistance at 1.8187 – 1.8200
  • Topside breach targets 2010 high at 1.8280, 1.8567, 1.8812
  • Interim support 1.8060, 1.7984 / 1.8000- Scalp bias bullish above this mark
  • Broader bias constructive above 1.79- bullish Invalidation
  • Daily RSI in overbought (bullish)-Multiple support triggers/70-break to signal correction
  • Key Events Ahead: Australia Trade Balance tonight and BoE Interest Rate Decision Tomorrow

GBPAUD Scalp Chart

Forex_GBPAUD_Long_Scalps_Eye_Key_Resistance-_Bullish_Above_1.79_body_GBPAUD.png, GBPAUD Long Scalps Eye Key Resistance- Bullish Above 1.79

Notes: This pair has been extremely popular in DailyFX on Demand and ahead of major US event risk I thought it prudent to highlight this long-range scalp. Last month’s break above technical resistance at 1.7470 shifted our focus higher and while our broader bias remains weighted to the topside, the pair has now come into a key near-term resistance range between 1.8187 and the 1.82 figure. Aggressive players will be attempting shorts against this threshold while conservative traders will be looking for fresh long entries lower down.

The pair has continued to trade within a well-defined ascending channel formation dating back to November 27th and it’s worth noting that topside breaches of these types of structures can often be the steepest/sharpest part of the trend. The initial weekly & monthly opening range looks to have been compromised to the topside and as such offer further conviction on our directional bias. We will utilize the 1.8060 level as the opening range high with the level representing favorable long-side entries.

Near-term momentum does risk a pullback here with an intra-day support trigger set as we head into event risk from Australia tonight and the BoE interest rate decision tomorrow morning. Note that the daily average true range on the pair is rather wide with a quarter of the ATR coming in at 44pips. Although the ranges between our scalp targets are much larger, it’s important to remain prudent as we open up the month with a portion of the trade to be booked & stops brought to break-even upon achieving the objective range.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

Entry/Exit Targets

Timeframe

Level

Significance

Bearish Invalidation

Daily / 30min

1.8187 – 1.8200

1.618% & 50% Exts / TL Resistance

Break Target 1

Daily / 30min

1.8280

2010 High / Soft Resistance

Break Target 2

Daily / 30min

1.8360

Soft Resistance / Pivot

Break Target 3

Daily /30min

1.84

Big Figure / Psychological Level

Break Target 4

Daily / 30min

1.8460

Soft Resistance / Pivot

Break Target 5

Daily / 30min

1.8567

1.618% Fib Extension

Support Target 1

30min

1.8100

Big Figure / Psychological Level

Support Target 2

Daily / 30min

1.8060

Weekly Opening Range / November High

Support Target 3

Daily / 30min

1.7984 – 1.8000

1.618% & 100% Extensions

Bullish Invalidation

Daily / 30min

1.7900

Dec Range Low / Channel Support

Break Target 1

Daily / 30min

1.7835

38.2% Extension

Break Target 2

30min

1.7564

Nov 25th Weekly Low

Break Target 3

30min

1.7470

61.8% Extension

Average True Range

Daily

174

Profit Targets 43-46pips

Other Setups in Play:

---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

To contact Michael email mboutros@dailyfx.com or Click Here to be added to his email distribution list

Join Michael for a Live Scalping Webinar on Monday on DailyFX and Tuesday, Wednesday and Thursday mornings on DailyFX Plus (Exclusive of Live Clients) at 1230 GMT (8:30ET)

Interested in learning about Fibonacci? Watch this Video

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