GBPAUD – Binary Options Technical Analysis
Australia – CB Leading Index
Today, at GMT 3:30 p.m., the Conference Board Inc will release the month-over-month leading index for Australia, which measures the changes in the level of a composite index based seven other major fundamental indicators.
Since the CB leading index aggregates some of the other indicator data, binary options investors 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 increased by 0.1% and if it once again comes positive, it would certainly help appreciate the Australian Dollar this week.
United Kingdom – GDP Second Estimate
On Friday, at GMT 9:30 a.m., the UK’s Office for National Statistics will release the quarter-over-quarter second estimate of the GDP, which measures the changes in the inflation adjusted value of all products and service made in the country over the past quarter.
Since GDP measures the overall productivity in the economy, the second estimate acts as a leading indicator of the actual GDP growth level. Hence, binary options traders consider the UK’s second estimate GDP (q/q) to be an important indicator of the health of the economy.
Last quarter, the second estimate GDP was at 0.6% growth and the forecast for this quarter is also set at an additional 0.6% growth.
Trade Recommendation for the GBPAUD
Since May 26, 2016, the GBPAUD has been on a strong downtrend that pushed the price by around 3,550 pips and formed three distinct downtrend lines in the process. Last week, the GBP/AUD broke above the first of those three trend lines after forming a minor bullish outside bar (BUOB) on August 16.
The bullish retracement pushed the GBP/AUD price towards the intermediate pivot zone around 1.7250, where the pair found a strong resistance and formed a bearish pin bar.
As both significant fundamental events involving the GBPAUD, the UK’s second estimate GDP and Australian CB leading index, are expected to remain somewhat same as the previous period, the fundamental outlook for the GBBAUD would remain neutral this week.
Hence, the formation of the bearish pin bar would likely to play a significant role this week. If the GBPAUD price breaks below the low of this pin bar, it would certainly attract additional bearish momentum in the market.
Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the GBP/AUD with their Australian binary options brokers as soon as the price and closes below the 1.7105 level, which is the low of this bearish pin bar.
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