CARVING OUT MAJOR BOTTOM; LOOKING TO BUY INTRADAY DIP
Gbp/Aud: We contend that the market is in the process of carving out a major base since posting fresh multi-year lows by 1.9690 back on May 8, 2009. The formation and subsequent trigger of a double bottom on the daily chart reaffirms our bullish outlook, with the break of neckline resistance at 2.0610 on Tuesday opening the door for a fresh upside extension and measured move objective back towards the 2.1300 area at a minimum over the coming days. The latest pullback should be used as a formidable opportunity to establish fresh longs with any additional setbacks seen limited below 2.0500. Strategy: BUY @2.0410 FOR AN OPEN OBJECTIVE, STOP @2.0160. Recommendation to be removed if not triggered by NY close (5pm ET) on Thursday.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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