The GBP/AUD pair broke higher during the course of the session on Wednesday as we cleared the 1.97 resistance barrier. Now that we’ve gotten above there, I feel that the market is free to continue higher, probably to the 2.00 barrier. That of course is a large, round, psychologically significant number, and with that the market will more than likely run into quite a bit of selling pressure in that general vicinity.
The pair ultimately is bullish, and as a result I believe that there are plenty of buyers below so pullbacks should offer a bit of value in the British pound as the Australian dollar continues to suffer overall. Ultimately, I don’t see any reason why this pair doesn’t climb and I am willing to look for short-term charts that show signs of support in order to go long again. I think that the Australian dollar will continue to weaken over the longer term as commodities in general continue to get beat down.
Longer-term uptrend
Ultimately, he think we are in a longer-term uptrend and there’s no real way to go against that now. With that being the case, I think that there is essentially a “floor at the 1.93 level below. On top of that, we do have Quarterly Inflation numbers coming out of the United Kingdom today, and that of course could put pressure to the upside on the British pound. If that’s the case, I would anticipate that this market should make a rather rapid ascent as the market is very illiquid at the point in time. The larger markets will continue to be the ones that are the “safest” overall, but in the meantime I would anticipate that this is a one-way bet, and as a result there could be big gains to be had in this pair. This market will continue to offer short-term buying opportunities, and I think that the shorter time frames will be the way to look for profits in this market. I do not have any selling scenarios at the moment.
