We have had fairly poor data coming from the RBA recently such as a very low CPI
reading and of course the recent rate cut to 1.75%. This alone is enogh to bring the AUD back down to the fair price of 7000 set out by the RBA some 18 months ago. Looking forward to next week we have the RBA monetary policy
report which we expect to be dovish as it was from a rate cut meeting and we also have employment data which is expected to have deteriorated. Along with a strong retail sales figure from the US side of the currency pair and an above expected UoM consumer sentiment report AND further good US data expected next week the WEAK/STRONG divergence on this curreny pair is significant. We like to trade from the best price possible which is always a pull back on the current trend. If data comes in as expected on both sides then a small pull back to previous support can be expected, however if data disappoints on either side then the pull back could be much bigger. The way the data is due to be released would suggest that unless we get a little hawkishness in the Monetary policy
report a small pull back if any is more likely probably due to profit taking if anything. I will be splitting my position across the two entry points but keeping my stop loss and take profit the same as illustrated on the chart. If you want to see how I intent to trade the GBP/USD
next week using the same simple strategy as outlined on this pair then jojn me for the FREE webinar on Sunday evening https://webinar.getresponse.com/DGy/Sunday-Webinar
have a great trading week.