GBPAUD weekly outlook Technical and fundamental.
If the price fails to break the current level at 1.7912, the price will break a descending triangle where the abcd pattern will be invalid, and a 5 wave sequence will be active, where 1.88300 will be the end of intermediate wave (5). if we look at the RSI, a bullish hidden divergence have occurred. ( keep in mind that the RSI leg can be extended, before a trend reversal) this could mean that the price have a short term bearish run.
A short position can be taken if the descending triangle is broken, where a break of the triangle, will also be a break of a rising wedge, this will make a strong position, as there is two technical factors in play. the TP will be at 1.75950 where TP2 is at 1.73230 level.
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Tuesday may 22:
GBP: Public sector net borrowing is expected to rise from -0,3 B to 7,2 B. ( Which is bad for the currency ) The results from the last couple of years in May have been quite high, i therefore expect that the numbers this year also will end up high, around the consensus. At the same day we have inflation report hearing. CBI industrial order expectation are also expected to fall short, from 4 to 2.
Wednesday May 23:
AUD: Construction work done q/q is released where the result is expected to rise from -19,4% to 1,3% ( the release gives early insight into the GDP numbers that are released 1 week later ) the numbers from the last couple of years have been bad.
GBP: CPI y/y are expected to hold a steady level at 2,5 % which is good, but taking in mind that from the beginning of 2018 the CPI data have been falling where the last two consensus have failed to meet expectations.
PPI Input m/m are expected to rise from -0,1% to 1,1% which is greater than the last year's numbers at 0,1%.
RPI y/y are also expected to increase from 3,3% to 3,4% where last years numbers where 3,5%.
Core CPI y/y, PPI output m/m, is expected to increase 0,1%.
Thursday May 24:
GBP: BOE Gov Carney speaks, where Retail sales m/m is released the same day. the numbers are expected to rise from -1,2% to 0,8% where last years numbers where 2,3%.
Friday May 25:
GBP: Second estimate GDP is expected to hold a steady level at 0,1%. this is less than the last couple of years numbers with 0,2%, 0,4% and 0,3% in May 2015.
Prelim business investments q/q is also expected to fall short from 0,3% to 0,2% which is less than last years 0,6% in may. this is still greater than last quarter 0,0%
BOE gov carney speaks again the day.
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The price have had a uptrend the last couple of months, where a rising wedge formation have occured. the price have produced a abcd pattern, where a break up from the descending triangle could leed the price to a intermediate wave count, where the last leg up will end at the 1.88300. this is also supported by the hidden bullish divergence in RSI. ( the RSI downtrend could be extended) while a break down from the descending triangle will also mean a break of the rising wedge, this could get the price to go down to the 1.75950 level and a break of this could make the price go to 1.73230.
I expect the prices to fall where the economic data the coming weeks will fail to meet the expectations. if the numbers turning out to be positive, and brexit talks is going further in Britains favor, the price could extend its wave count and continue with the 5 leg up.
A short position can be taken if the descending triangle is broken, where a break of the triangle, will also be a break of a rising wedge, this will make a strong position, as there is two technical factors in play. the TP will be at 1.75950 where TP2 is at 1.73230 level.
_________
Tuesday may 22:
GBP: Public sector net borrowing is expected to rise from -0,3 B to 7,2 B. ( Which is bad for the currency ) The results from the last couple of years in May have been quite high, i therefore expect that the numbers this year also will end up high, around the consensus. At the same day we have inflation report hearing. CBI industrial order expectation are also expected to fall short, from 4 to 2.
Wednesday May 23:
AUD: Construction work done q/q is released where the result is expected to rise from -19,4% to 1,3% ( the release gives early insight into the GDP numbers that are released 1 week later ) the numbers from the last couple of years have been bad.
GBP: CPI y/y are expected to hold a steady level at 2,5 % which is good, but taking in mind that from the beginning of 2018 the CPI data have been falling where the last two consensus have failed to meet expectations.
PPI Input m/m are expected to rise from -0,1% to 1,1% which is greater than the last year's numbers at 0,1%.
RPI y/y are also expected to increase from 3,3% to 3,4% where last years numbers where 3,5%.
Core CPI y/y, PPI output m/m, is expected to increase 0,1%.
Thursday May 24:
GBP: BOE Gov Carney speaks, where Retail sales m/m is released the same day. the numbers are expected to rise from -1,2% to 0,8% where last years numbers where 2,3%.
Friday May 25:
GBP: Second estimate GDP is expected to hold a steady level at 0,1%. this is less than the last couple of years numbers with 0,2%, 0,4% and 0,3% in May 2015.
Prelim business investments q/q is also expected to fall short from 0,3% to 0,2% which is less than last years 0,6% in may. this is still greater than last quarter 0,0%
BOE gov carney speaks again the day.
_____________
The price have had a uptrend the last couple of months, where a rising wedge formation have occured. the price have produced a abcd pattern, where a break up from the descending triangle could leed the price to a intermediate wave count, where the last leg up will end at the 1.88300. this is also supported by the hidden bullish divergence in RSI. ( the RSI downtrend could be extended) while a break down from the descending triangle will also mean a break of the rising wedge, this could get the price to go down to the 1.75950 level and a break of this could make the price go to 1.73230.
I expect the prices to fall where the economic data the coming weeks will fail to meet the expectations. if the numbers turning out to be positive, and brexit talks is going further in Britains favor, the price could extend its wave count and continue with the 5 leg up.