It should be a good time to convert some of your British pounds to Australian Dollars. With mixed data coming from China and a clear signal from the Reserve Bank of Australia that interest rates are on hold for now, there is every reason to see further weakness in the Australian Dollar.
Having said all that, it isn’t happening right now. The Sterling – Australian Dollar exchange rate is in an uneasy stubborn equilibrium in the middle of a range it has occupied for the last 6 months.
Support for the Pound around 1.5350 is very evident and Aussie Dollar buyers can be found lurking around 1.5650 and 1.5850. If we do get a break to higher levels, 1.60 is the big psychological barrier which ought to cap this pair for now.
1.60 is also a trend line resistance level and a long term Fibonacci resistance level. If you have no idea what that means, read The Da Vinci Code. You’ll be none the wiser but the Fibonacci progression is mentioned in there. If the Pound really does flop, expect further support at the august low of 1.47 and the longer term channel support at 1.44.