GBPAUD – Binary Options Technical Analysis
United Kingdom – Net Lending to Individuals
On Thursday, at GMT 9:30 a.m., the Bank of England will release the month-over-month net lending to individuals figure, which measures the changes in the total value of new credit issued to consumers in the past month.
Since consumer spending is highly correlated with consumer credit, the net lending to individuals figure can indicate future consumer spending as well as consumer confidence in the economy. This is because people only take on debt when they feel financially secure about future incomes. Hence, binary options investors consider this data to be extremely important.
Last month, the last net lending to individuals figure came out at $3.8 billion and the forecast for this month is set at $4.0 billion.
Australia – Private Sector Credit
Later on Friday, at GMT 2:30 a.m., the Reserve Bank of Australia will release the month-over-month Private Sector Credit data, which measures the changes in the total value of new credit issued to consumers and corporations in the country over the previous month.
Binary options traders consider the private sector credit to be an important fundamental indicator of the Australian economy as borrowing and spending are highly correlated. Consumers and businesses only take out credit when they feel confident about their ability to pay it back in the future. Hence, it also acts as a measure of consumer and business confidence.
Last month, the private sector credit in Australia increased by 0.4% and the forecast for this month is currently set 0.5%.
Trade Recommendation for the GBPAUD
Since forming a Bearish Outside Bar (BEOB) on September 15, the GBPAUD price has fallen by around 650 pips and currently, it is trading near the support level around 1.6930.
As the Australian private sector credit figure is expected to go up by 0.1% to 0.5% this month, it would likely increase the bearish momentum of the GBPAUD. Hence, there is a good chance that the GBP/AUD price would break below the 1.6930 support by the end of the week.
On the other hand, the net lending to individuals figure in the United Kingdom would also increase from $3.8 billion to $4.0 billion, which represents a 5.2% increase. However, given the strong bearish momentum of the GBPAUD, we believe a break below the support offers a better trade setup for binary options traders.
Under the circumstances, it would be recommended that binary options traders consider placing a PUT order for the GBPAUD with their binary options brokers as soon as the price and closes below the 1.6930 level on the daily time frame.
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