GBP/AUD Likely to Bounce Near Key Resistance if UK’s Retail Sales Continue to Soar

GBPAUD  Forecast & Technical Analysis

Australia – CB Leading Index

On Tuesday, at GMT 2:30 p.m., the Conference Board Inc released the month-over-month leading index for Australia. It measures the changes in the level of a composite index based on seven other major fundamental indicators.

The CB leading index aggregates some of the other indicator data. So, HighLow.net traders consider this to be an important representation of the overall Australian economy. However, since most of these data are previously released, the CB leading index tends to have a minimized immediate market impact.

Last month, the CB leading index came out at 0.9%. This month, it declined by -0.4%.

United Kingdom – Retail Sales

On Friday, at GMT 6:30 a.m., the UK’s Office for National Statistics will release the month-over-month retail sales figure. It measures the change in the total value of sales made by the retail sector in the country over the past month. However, this is adjusted for inflation in order to offer an accurate overview.

Binary options investors consider the UK’s retail sales figure to be one of the main gauges of consumer confidence. Because it makes up the majority of the overall economic activity in the country. Also, consumer spending is directly correlated with consumer confidence. So, it can signal future economic activity as well.

Last month, the value of the UK’s retail sales increased by 12.0%. Analysts are expecting it to grow by an additional 8.3% this month.

GBPAUD Forecast

GBPAUD Forecast - July 22 2020
The GBPAUD broke above the primary downtrend line on July 1, 2020. Since then, it remained most range-bound. During the last few weeks, the GBP/AUD kept fluctuating between the 1.7865 and the 1.8210 level. Earlier today, it fell to test the 1.7865 level once again. However, currently, it appears to be gaining some bullish momentum.

The Australian CB Leading Index declined by -0.4% over the last month. On the other hand, analysts are expecting the UK’s retail sales to grow by 8.3%. If the retail sales in the UK grow close to the forecast, we believe it would set a bullish fundamental outlook for the GBP/AUD this week. Therefore, if the GBPAUD remains above the support near 1.7865, it would likely attract additional bullish momentum in the market.

Hence, Australian binary options traders should look out for trading opportunities above this major support level around 1.7865.

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

Leave a Reply