GBP/AUD Daily chart providing signals the September 3.5% rise since 11th of September has now met with the open price of the month forming extremely potent resistance.

GBP/AUD

Provides a great reward to risk ratio to trade GBP/AUD for short – term downside.

GBP/AUD

Key Points:

  • Daily – Price moving into resistance and September open price 1.18235
  • Daily – Above 50 EMA – Watch for close below for first session.
  • Daily – Below 200 EMA
  • Price holding above the 200 EMA – 1.2% gap between price and 200 EMA
  • Price holding above the 50 EMA
  • Price at September open
  • Ending diagonal?
  • 8% Fibonacci for prior range
  • Divergence between RSI lower high and price higher high.

Key Levels:

Support – 1.80265, 50 EMA, 1.79100, 200 EMA

Resistance – 1.81665, 1.81800

Entry Zone:

Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.

Optimal Entry – 1.81350

Supporting Entry – 1.81150

Candle Reversals for entry

  • Bearish Shooting Star
  • Bearish Engulfing
  • Bearish Dark Cloud CoverBearish Candlesticks

 

The Risk:

As traders, it is your job to mitigate the risk and only trade structures that provide high probability and great reward to risk ratios.

If you are not comfortable with defined exit levels, experiment with Moving Averages to help set solid exit rules to protect your capital.

IF: Price breaks above 1.81825 level – this would suggest the structure is not in our favour and would be wise to reduce exposure or close the trade until a solid signal gives us reasons to re-enter.

Reward / Reward Targets:

Optimal Entry 1.81350 – Target 1 1.80265 = 2.2x Reward to Risk

Optimal Entry 1.81350 – Target 2 1.79100 = 4.7x Reward to Risk

 

Supporting Entry 1.81150 – Target 1 1.80265 = 1.2x Reward to Risk

Supporting Entry 1.81150 – Target 2 1.79100 = 3x reward to Risk