I’m seeing a simple reversal formation on the 4-hour chart of GBP/AUD.
It looks like the pair is closing in on the neckline already, so better keep an eye out for these levels:
GBP/AUD: 4-hour
This currency pair made a couple of failed attempts to break below the support around the 1.7200 mark, creating a double bottom formation right here.
Better brace yourselves for a reversal from the downtrend, fellas!
GBP/AUD is already closing in on the neckline of the chart pattern while the moving averages made a bullish crossover, hinting that an uptrend might follow soon.
Worsening COVID conditions and tighter restrictions in China appear to be weighing on the higher-yielding Aussie, so the odds might be in favor of an upside break.
In that case, the pair might be in for a climb that’s approximately the same height as the reversal formation, which spans 650 pips.
Just be careful when hopping in a long position because Stochastic is already hovering at the overbought territory, reflecting exhaustion among buyers.
If the neckline resistance around 1.7850 holds, GBP/AUD could go for another test of support around the bottoms.
