The currency pair of the British pound with the Australian dollar has recorded declines of up to 2000 pips since the beginning of February this year. Such large declines can be explained by high prices for energy and agricultural commodities. Australia is one of the world’s largest exporters of iron ore, coal and gold. I presented the export structure in last week’s analysis.

  • Pound sterling loses 2000p to the Australian dollar in two months
  • 27 thousand new cases of covid-19 in Shanghai
  • bullish pin bar on weekly chart suggests upward correction

Rising commodity export prices have definitely worked in favour of the Australian currency, but recent news from China has slowed AUD appreciation, there are fears of another wave of covid-19 and the isolation of more industrial centres. Yesterday’s data showed 27,000 new cases of the disease, mainly in the Shanghai area.

While AUD benefited from a bull market in commodities, sterling lost to USD and other commodity currencies. Russia’s aggression against Ukraine and the sanctions imposed on the aggressor caused European currencies, including the British pound, to weaken.

Technical analysis GBPAUD

GBPAUD W1 – the bullish pinbar may be a signal of an upward correction

The GBPAUD exchange rate has reached the level of 1.7170, where there is a demand zone formed at the end of 2018 and has not been overcome so far. The past week ended with a slight upward correction and a clear bullish pin bar appeared on the chart.

GBPAUD H4 – inverted head and shoulders is a formation that heralds an upward correction

An inverted head and shoulders formation appeared on the four-hour chart. The price is currently above the neckline. The height of the formation is 360 pips. If the price made such a move in the upward correction, the demand target could be the level of 1.7800 and higher.


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The above analysis is based on the PA+MACD strategy, a detailed description of which you can read HERE . I will talk more about the PA+MACD strategy applied to these currency pairs during the live trading sessions which you can attend from Monday to Friday.
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