Firstly, here we are on the four-hour chart, we have highlighted two very important zones – these being the 1.79417 zone and the 1.77269 zone. We will be looking for bearish evidence if we approach the 1.79417 zone as this is a key level on the daily chart and holds up a decent structure. I can personally see this as a high resistance zone but if this gets broken then we can potentially move up to the upside and a continuation.
Secondly, we have the 1.77269 if we see GBP/AUD pull back to this region we can look for potential bullish evidence also likewise if the zone gets broken we could see a move to the downside maybe even to push to the next daily key level.
It is best to see where the pair moves over the next 12 hours to see if we can get a retest on the two zones as the structure may hold support and/or resistance.
Please bear in mind that the structure can be broken. Zones are there to be broken as they don’t always hold up but can create great trading opportunities.
Please note: Although I am highlighting important zones on the chart, it does not mean that a trader must look for aligning evidence and a potential opportunity on the daily chart. A trader could be looking for aligning evidence and a potential opportunity in this area on the daily, 8hr, 4hr, 1hr or whatever time frame suits them as a trader.
As for myself, I will most likely look for aligning bearish evidence in this area and a potential bearish opportunity on either the 4hr or 1hr time frame.
Have a pip’in day!
OpulenceUK Team & Grant (Senior Analyst)