The Pound has remained relatively stable against the Australian Dollar for the past 6 months or so. There is very clear technical support at A$1.48 which came into play when the Pound fell below the previous support at A$1.49 a few days ago.
As you can see, A$ 1.48 provided support through July and August and, considering the Pound is oversold, as shown by the RSI measure at the bottom of this chart, we may well see this support level hold again.
Sterling, as mentioned elsewhere in this report, is struggling due to the UK’s relationship with Europe and that will continue to be the case until we start to see stronger UK data and perhaps until Europe starts to sort its problems out.
If anyone knows when that might happen, please let the rest of us know. For now, those who need to buy the Aussie Dollar may want to protect themselves against a fall below A$1.47 but look to take advantage on any bounce to A$ 1.53.
Aussie Dollar sellers may be looking a gift horse in the mouth if they don’t protect some of their requirements at this level or cover the risk of a reversal with a Stop Loss Order
Thanks to Halo Financial for contributing this article.