GBP/AUD is struggling to find a direction after hitting a technical resistance late last week.
In case you missed it, the release of Friday’s U.S. NFP report caused volatility spikes among the major U.S. dollar counterparts.
Among the volatile currencies, the British pound outpaced commodity-related currencies like the Aussie following the release of net positive U.K. PMI reports.
The pound’s strength over the comdolls extended to this week when not even a net weak U.K. labor market data release kept GBP in the red against AUD, CAD, and NZD for long.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on the British pound and the Australian dollar, it’s time to check out the economic calendar and stay updated on daily fundamental news!GBP/AUD: 4-hour
GBP/AUD 4-hour Forex Chart by TradingView
GBP/AUD has since traded lower after hitting resistance at the 1.9350 area. The pair is now trading closer to 1.9250 – 1.9300, which isn’t too far from the Pivot Point (1.9249) and previous resistance levels in the 4-hour time frame.
More importantly, GBP/AUD’s levels line up with the mid-channel area on the chart.Will the pair extend its uptrend in the next trading sessions?
A couple of bullish candlesticks from its current levels can draw in enough buyers to push it back to its 1.9350 highs if not the R1 (1.9405) Pivot Point line near the top of the ascending channel pattern.
But if this week’s headlines continue to limit GBP/AUD’s bullish prospects, then the pair may see a deeper pullback before the bulls step in. A move to the S1 (1.9162) Pivot Point line near the channel and 200 SMA support zone may be on the table if GBP/AUD trades below the PP and mid-channel zone.
What do you think? Will GBP/AUD extend its uptrend from its current levels? Or will the pair see bearish pressure before it sees sustained bullish demand?