GBP/AUD has been moving sideways since around the 19th of June, within a range between 1.7980 and 1.7735. But this activity could be seen as the calm before the storm and could lead to a push higher. The pair has started creating higher lows, since it reversed from its short-term downtrend that ended around the 5th of June. This makes us think that the sideways activity, which we observed over the past few week could be a pause within the trend.
GBP/AUD is not far from the upper bound of the aforementioned channel. If the pair starts breaking the 1.7950 level, this could straight away open the path towards the 1.7980 zone. A break of that zone, which is the upper side of the range, could set the stage for more bulls to jump in and drive GBP/AUD towards 1.8040, or even to the 1.8110 level, marked by the peak of 16th of May.
Looking at our oscillators, the RSI is in support of the upside as well, as it has moved further up from its 50 mark and continues to aim higher. The MACD is also looking promising, as it is above both its zero and trigger lines and is also pointing to the upside.
Alternatively, a drop down from near the 1.7950 area could start raising concerns, whether the upper bound of the previously mentioned range could be too much for GBP/AUD to overcome for now. If the bears take the driver’s seat, we could see a move back down towards the 1.7795 level, a break of which could force the rate to test the lower side of the range, at around 1.7735. This is where the pair could stall for a bit, until the bulls and the bears decide who will take control at least for the short-run.
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