On both daily as well as monthly charts, despite the formation of bearish patterns, the bull swings have been evidenced.
Yes indeed, the bearish engulfing candle appear at 1.6927 levels, and long-legged doji at 1.7085 has occurred at peaks of rallies in the consolidation phase of GBPAUD.
After a stern bullish rally in the price behavior from last two-three months, the pair is all set to break out above stiff resistance zone of 1.7180-90. Since Friday the sharp bounce back rallies are observed that has gone above DMAs.
While both leading (RSI and stochastic) indicators are suggestive of intensified bullish momentum.
The stochastic oscillator has been popping up with buying sentiments with its %k crossover which is a bullish indication, while RSI has also been converging to these price rallies.
On the other hand, MACD has been quite indecisive but remains in the bullish territory to substantiate above-stated buying interests.
On a broader perspective, both leading oscillators are converging upwards but slightly indecisive entering in the overbought zone (refer monthly terms). While the current prices on this timeframe spike above EMAs with bullish crossover.
Contemplating above technical reasoning, we could foresee more rallies on cards with 7DMA acting as a strong support and 1.7185 as the stiff resistance.
Hence, double touch option is useful for intraday traders who believe the price of an underlying asset would undergo a large price movement, but who are unsure of the direction.
At spot reference: 1.7166, one can use a double touch option with barriers at 1.7185 and 1.7150 to capitalize on this outlook.
Some traders view this type of exotic option as being like a straddle position since the trader stands to benefit on a calculated price movement up or down in both scenarios.
In this case, the trader stands to make a profit if the rate moves beyond either of these levels before expiry, and he/she stands to lose the premium if the rate remains within these barriers.
Currency Strength Index: FxWirePro's hourly GBP spot index has turned into -79 (which is bearish), while hourly AUD spot index was at shy above -126 (bearish) at 12:23 GMT. For more details on the index, please refer below weblink:
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