Our focus pair is technically flat but that doesn’t mean there is no potential in the coming days. Even though I’m bullish on this pair, my forecast will mean nothing if prices remain confined inside a 150 pip range between the 50% and 61.8% Fibonacci retracement level anchored at Q4 high lows.
As we can see, since the beginning of the year, those higher highs relative to the lower BB continue to consolidate horizontally and despite today’s dip, I expect support at 1.72 or there about. Stochastics is also oversold but a bull entry signal is yet to be printed as guide.
In my opinion, bull pressure will only be confirmed the moment there is a close above the 50% correction level at 1.735 with a buy signal turning from oversold territory otherwise we remain on the sidelines until a clear trend develops.
This is my GBPAUD trade plan:
Buy Stop: 1.7360
Stop Loss: 1.72
Take Profit: 1:3 risk reward ration but ideal at 1.8
Let me know what you think!!