AUD Finds Its Legs

Looking to the left of the chart, we can see that previous breaks lower that closed the week below 1.55 saw momentum carry price lower.  Even on a smaller time frame, the daily chart, a candle close below 1.55 followed by a subsequent candle close below 1.55 saw a price drop as low as 1.5250.

This was how I closed my new year post on the $GBPAUD. In today’s Wednesday session, the pair actually broke that support at 1.5250 to reach a low of 1.5191 before bouncing back to the 1.5250 to end trading just below the former support level.

GBPAUD daily chart
Minutes before Chinese data released

Now China has just released its trade balance numbers (9:00pm EST) and they beat market expectations by a wide margin. As such, the AUD is rallying big time in reaction to the positive news. Already down 70 pips in 20 minutes, the $GBPAUD has made new lows than the previous 1.5190 lows and is still falling. With no real support until the 1.50 major psychological level, $GBPAUD is on track to test its 2012 lows at 1.4700.

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