My complete trading plan for the GBPAUD

As you already know, I like to trade the currency pairs that have a clear condition on both, long term and short term charts.

This way we can determine:

  • ST and LT support and resistance levels
  • Market swings

And once we have that information, we can do wonderful things with the market.

When you’ve got clear S&R levels plus clear swings you know what the market is doing, and when you know what the market is doing, is quite easy to determine what the market is likely to do.

In order to get to that point you need to do both, a LT and a ST analysis… just like this one:

GBPAUD Long Term Analysis

Here is the long term chart:

GBPAUD 1D

Right now the GBPAUD is trading near a LT level, that means that we still dont know whether the market is going to break that resistance level up or get rejected from that level and continue its way down.

The good thing about this is that WE DONT NEED TO KNOW.

We can look at the short term charts to determine the levels that the market needs to break so we can start looking for trade opportunities.

GBPAUD Short term analysis

Here is the short term chart:

GBPAUD 1H

The good thing about the GBPAUD is that it’s got clear S&R levels in the short term charts… and because of this we can create a complete trading plan.

  • If the GBPAUD breaks above the ST resistance level (1.8344) I’ll start looking for long opportunities.
  • If the GBPAUD breaks below the ST support level (1.8106) I’ll start looking for short opportunities.

It looks like we are getting the second rejection of the resistance level, we’ll have to confirma that!

Your Turn

What do you think about my analysis? Are you going to trade the GBPAUD?

What other currency pairs are you monitoring?

Share your thoughts!

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Raul Lopez

I've been trading the markets for more than 15 years. I believe the best way to trade is by adapting to the market conditions. You can learn it too, join our community .

  • Pankaj Mehra

    is it the best time to go short as the pair broke out the ST support level @(1.8180) on 22 and then retests it today.And also on fundamentals ,the trimmed mean cpi is better than expected. i think its a good time to go short with the breakout and 1.7828 will be a good place to take profit.

    • Raul Lopez

      I woudlnt take the breakout of off the ST level while the market is trading near an important level… that’s when most false breakouts occur…

      In this case I’d wait for a retracement or other type of entry…

      Good luck Pankaj!!!

  • Antonio

    Thank you, best regards !

    • Raul Lopez

      No problem Antonio, let me know if you need anything else!

      Good luck!

  • Antonio

    I watch when comercials in a strong buying or selling versus large speculators, and then look the opposite of comerciall for trade, only rare opportunities to maybe 1-3 times a year to be good for trade …. trade weekly charts …. your strategy offers more opportunities

    • Raul Lopez

      Yep, you are right, you could only use the COT Analysis for long term trends…

      Using the market condition you could also read the sentiment of the market…

      Good luck Antonio!

  • Antonio

    Hi Raul, does it make sense to watch The Commitments of Traders (COT) ?

    • Raul Lopez

      Yes Antonio, it could… But not to make your final decision…

      In which way are you using it?

  • TasosK

    Hey Raul,

    Another excellent post. Indeed, your trading plan do make sense… I have 3 quick questions though: (1) will you take into account the market trend before you take a trade opportunity? (the market is ranging 1.78 – 1.83 since mid-April) (2) would you trade the ST range (1.818 – 1.835) in 1H TF? and (3) once price breaks the ST levels, what event would trigger your trade entry (e.g. a PIN bar)? Thank you. Tasos

    • Raul Lopez

      Hey Tasos,

      (1) – I take in consideration the market condition (please read my trading manifesto) not the trend of the market.

      (2) – I would only trade in the direction of the market condition.

      (3) – A breakout, a retracement signal, etc.

      HTH

  • Eric Aroh

    Potentially, very good trade with high reward compared to risk.

    However, I noticed the following: generally LT uptrend.

    (1) Daily Chart (510 periods): Ranging (+/- 600 pips) and tradable. I will watch to see if it retraces after (possibly) bouncing back from LT resistance (1.8368). But will go LONG at 1.8383 – on a breakout.

    (2) H1 Chart (200 periods): It has tested the 1.8300 resistance at least 6 times (within the last 7-9 hours), and currently completing a bearish candle. This creates the scenario of possible ranging (+/- 140 pips) which I consider tradable because of the potential large pip swing of the GBPAUD pair (180 pips). Also I can glean a completed double top: which provides high probability of retracing southwards towards the 1.8160 support.

    My actions:

    Wait until breakout on the Daily chart and go LONG @ 1.8383 OR

    Go SHORT on the H1 chart and catch 75 pips on the retracement : risky!

    What do you think?

    • Raul Lopez

      Sounds like a good trading plan… did you trade it?

  • felix samson onoura

    Hi Raul
    The GBPAUD LT resistance is near 1.82006 while ST 1hour resistance is near 1.83448 obviously there is lots of pips difference please are this two levels still at same zones? even the both support still has lot of price differences can they also be referred to be at same zones? and which of this charts has most important levels?
    GBPUSD has clear market conditions both on LT daily chart and ST 1hour chart. this market has clear key resistance near 1.7170 and near term support 1.6919 and key support 1.6990 i sold below resistance in the early hours of today if price do not hold above next near term support we would expect it fall down to key support near 1.6919.
    BEST REGARDS Raul.

    • Raul Lopez

      Hello Felix, you are comparing two things that are different… S&R levels on the LT and ST charts tell different things, they are not comparable…

      The GBPUSD is bullish, but its ranging in the ST, and a not so clear range, so I’ll rather wait…

      Good luck Felix!