Currency Analysis Report 8/6/20 - Is The GBP/AUD Done Falling???
The British Pound had its best month in July in more than a decade. But like the US, there are now fears of a second wave of COVID-19 cases in Britain, which already leads all European countries with regards to people infected with the virus. And before you know it Fall will be here and there is still no Brexit deal with the transition period ending in December. This will put downward pressure on the Pound due to the uncertainty of a deal.
Meanwhile, the Australian dollar is the standout gainer and is now up more than 30% from March lows. It gained steadily over the last several months just as iron ore prices, Australia's top export are at all-time highs. However, the Australian dollar started of the month of August in consolidation mode and has been grinding sideways the last couple of months as investors awaited the interest rates decision on 8/4.
The Australian dollar was little changed during the Asian session as traders reacted to the country’s retail sales and the RBA interest rate decision. Data from Australia showed that retail sales rose by 2.7% in June after climbing by 16.9% in the previous month. In total, sales fell by 3.4% in the second quarter. In June, the country’s exports increased by 3% while imports rose by 1%, leading to a trade surplus of more than $8 billion. In a statement, the Reserve Bank of Australia left interest rates unchanged as most analysts were expecting.
So where is the GBP/AUD headed next?
Monthly Chart (Curve Time Frame) - monthly supply is 2.0500 at and monthly demand is at 1.6150.
Weekly Chart (Trend Time Frame) – the trend is up.
Weekly Chart (Entry Time Frame) – the chart suggested to go long at the weekly demand at 1.74500.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
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