GBP/AUD Set to Go Down After Breaking Below Major Support Around 1.6930

GBP/AUD – Technical Analysis for Forex Brokers

United Kingdom – Consumer Price Index

Tomorrow, at GMT 10:30 a.m., the UK’s Office for National Statistics released the year over year Consumer Price Index (CPI) that measures the changes in the price of goods and services acquired by consumers.

Since the CPI basically measures the inflation level in the economy, this data is considered Forex investors as one of the most important leading indicators of the overall economic health

Last month, the UK’s CPI (y/y) increased by 0.9%, and this month the forecast is currently set at a 1.1% growth.

Australia – Unemployment Rate

On Thursday, at GMT 1:30 a.m., the Australian Bureau of Statistics will release the national unemployment rate, which measures the percentage of total work force which remained unemployed over the past month.

Forex traders consider the unemployment rate to be one of the most important fundamental indicators of the Australian economy because one of the main goals of the Reserve Bank of Australia is to keep the unemployment as low as possible. Although this is a lagging indicator, analyzing this data can help Forex traders predict future interest rates and inflation situation in the country.

Last month, the unemployment rate in Australia came out at 5.6% and the forecast for this month the forecast is that the unemployment will remain unchanged at 5.6%.

Trade Recommendation for the GBP/AUD

GBPAUD - Technical Analysis for Australian Forex Brokers - Dec 11, 2016

Since forming a bullish pin bar on October 26, 2016, the GBP/AUD has remained a strong uptrend that pushed the price towards the resistance near 1.6930. However, after soon after closing above this resistance, the GBP/AUD price formed a bearish outside bar last week, which prompted the price to close below this pivot zone once again.

As the Australian unemployment rate is expected to remain unchanged at 5.6% and the UK’s retail sales is expected to come up better than last month, we believe the fundamental outlook for the GBP/AUD would remain bullish. However, as the pair has been trending upwards for over two months and just started a retracement last week, there is a good chance that the GBP/AUD price will go down a bit before resuming the uptrend.

Under the circumstances, it would be recommended that Forex traders consider placing a SELL order at market price for the GBP/AUD with their Forex brokers as soon as the pair closes below the 1.6840 level on the daily time frame. A possible profit target for this trade would be around the 1.6755 level. On the other hand, Forex traders should consider placing a stop loss order above 1.6930.

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Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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