Forex Market: GBP/AUD daily forecast

During yesterday’s trading session GBP/AUD traded within the range of 1.7983-1.8159 and closed at 1.8034, losing 0.61% on a daily basis.

At 7:21 GMT today GBP/AUD was gaining 0.87% for the day to trade at 1.8175. The pair touched a daily high at 1.8188 at 5:15 GMT, breaching the first key daily and the first key weekly resistance levels.

Fundamental view

At 11:00 GMT Bank of England is to announce its decision on monetary policy. The benchmark interest rate will probably be left unchanged at 0.50%, where it has been set at the meeting on policy on February 5th 2009. Short-term interest rates are of utmost importance for the valuation of national currencies. In case the central bank left intact or raised borrowing costs, this would have a bullish effect on the sterling.

At the same time, the monthly pace of bank’s monetary stimulus will probably be left intact as well, at 375 billion GBP. The central bank issues new money in order to purchase gilts from private investors such as pension funds and insurance companies. In case monetary stimulus is increased (in order to further spur economic growth), this will usually devalue nation’s currency.

Technical view

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.8059. In case GBP/AUD manages to breach the first resistance level at 1.8134, it will probably continue up to test 1.8235. In case the second key resistance is broken, the pair will probably attempt to advance to 1.8310.

If GBP/AUD manages to breach the first key support at 1.7958, it will probably continue to slide and test 1.7883. With this second key support broken, the movement to the downside will probably continue to 1.7782.

In weekly terms, the central pivot point is at 1.8093. The three key resistance levels are as follows: R1 – 1.8155, R2 – 1.8250, R3 – 1.8312. The three key support levels are: S1 – 1.7998, S2 – 1.7936, S3 – 1.7841.