GBP/AUD stretched and nearing known reversal area
GBP/AUD is rarely as overbought as it is right now. And when it has been this overbought in the recent past, it’s usually coincided with a near-term top. It’s also fast approaching 1.9500, a level that has been akin to poison for longs throughout 2024. Combined, it has me on alert for a potential topping signal, providing the catalyst to establish shorts with favourable risk-reward.
It’s clear the bulls are in control right now. But should we see a topping pattern – be it a bearish pin, tombstone doji or similar – the tale of the recent tape suggests getting short could prove fruitful. But wait for the appropriate signal before doing so.
Those considering taking on the trade could place a stop above 1.9570 for protection. Potential targets include 1.93493, the former downtrend just below 1.9300 or 1.9250.
DS
It’s clear the bulls are in control right now. But should we see a topping pattern – be it a bearish pin, tombstone doji or similar – the tale of the recent tape suggests getting short could prove fruitful. But wait for the appropriate signal before doing so.
Those considering taking on the trade could place a stop above 1.9570 for protection. Potential targets include 1.93493, the former downtrend just below 1.9300 or 1.9250.
DS
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