I have been following GBPAUD for some time now to see if the pair may retrace before continuing the uptrend it’s currently in.
As displayed on the Daily chart above, 1.8500 was a strong resistance level that GBPAUD could not penetrate. This level has been tested six times in the past and it still has not broken that level.
When you switch to the weekly timeframe, you can clearly see several large bullish engulfing candlesticks in a row, signifying impulsive moves. This shows that GBPAUD is on an uptrend in the longterm.
Right now, price is retracing down to the 1.8000 level, which is our monthly support level.
We might see a reversal pattern here in the lower timeframe before it continues back up again.
If price does break structure and returns to the uptrend, this could be a potential 500 pip trade waiting to be taken.
For now, we will wait and see.