GBP/AUD is heading up following the rebound on the 20-day simple moving average (SMA) currently at 1.9347. The upside tendency is continuing since July 2019 with the technical indicators confirming the bullish structure. The RSI is pointing up, above the 50-neutral threshold, while the MACD is in the process to post a positive cross with the trigger line.
If price action remains above the red Tenkan-Sen line and the 20-day SMA, there is scope to test the three-and-a-half-month high of 1.9750. This is considered to be a strong resistance area and if there is a break above it, the next levels to watch are the 1.9800 and 1.9900 ahead of the 2.0000 round number. Even higher the 2.0500, reached on May 2016, could come in the spotlight.
Should prices reverse lower, immediate support could come at 1.9230, which is the 23.6% Fibonacci retracement level of the up leg from 1.7560 to 1.9750. Below that, the 1.9160 support, which overlaps with the ascending trend line and lies near the 40-day SMA could come in focus. A drop below this area would take the pair closer to the Ichimoku cloud at 1.9040 and significantly weaken the bullish medium-term structure. Further losses would open the way towards the 38.2% Fibo of 1.8915.
In the medium-term picture, GBP/AUD is gently pointing up over this week, framing a positive profile. A strong rally above the three-and-a-half-month high of 1.9750 would extend the upward pattern, making the outlook even more bullish.
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