This is why I love trading GBP/AUD so much….

For the last few weeks I have been featuring GBP/AUD in my Forex price action analysis. Why am I featuring such an obscure pair?

… Because it constantly gives me easy and profitable reversal trades.

This weeks GBP/AUD price action reversals

Over the course of two days we got two very similar reversal setups at the 1.9775 resistance area on GBP/AUD. The setups are highlighted in yellow below.

GBP/AUD Price Action Reversals

So, how did these trades work out?

The first trade was entered short at 1.9765 with a stop loss of 45 pips and a first target of 75 pips. The second target of this trade was just over 110 pips. The first target was set at 75 pips because we often find that price gets tired as it pushes beyond the halfway mark between two areas of support and resistance. The second target was taken just before the support area at 1.9630.

The second trade had the same entry, stop and first target as the first trade. However, the second target was taken a little earlier at the 1.9680 as price stalled there for around an hour.

I do not normally jump out of the trade if price stalls for an hour. However, since I do not like being in trades too late on Friday, the brief stall was enough to drive me out.

GBP/AUD seems to really adhere to support and resistance areas well. When you see strong indecision forming on an area, you usually end up getting a really nice trade. You will also find that with GBP/AUD you get very similar setups from the same areas two or even three times.

I missed the first trade but caught the second. The entry, stop and targets for the first trade are based on the live trade of one of my advanced course members.

If you do not understand how and why these trades were taken, check out my free Forex price action strategy.

Questions

If you have any questions about my price action strategy or GBP/AUD please ask below.

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39 thoughts on “This is why I love trading GBP/AUD so much….
  1. Hi Nick

    I took the second trade on GbpAud as well, awesome setup and as you say, this is quite a good pair to focus on.The first one I missed because a similar setup formed on GbpUsd at the same time wich I took.Overall your strategy is really effective and very low maintenance which suits me pretty well.I am still a newbie and I must say for the past 2 months I had great results.Great job nick, I can truly say that I have found what I was looking for and are done following the pack.

  2. Hello Nick
    I´m sorry, but i think that in the 4 hourchart that my broker provides, the setup isn´t the same as yours. It´s similar but, the indicision candle doesn´t form, it´s like master candles.
    Why this is hapening?
    Is it because its a demo account?
    I didn´t open a real account because i´m watting for the advanced course (Can you tell me when it is)
    Best regards

    1. That is cTrader, you can use the demo at spotware .com, and it is the 4 hour time chart, you can see the icon H4 next to the pricing box

    2. This is normal. Brokers can have a different server time. This effects the candle open time. My candles open at 2am GMT, yours open at a different time. This will lead to candles that look very different.

    3. I have the same issue, I’m running a Demo account with FXCM (on MT4) and the setup looks completely different for me also, no indecision candles as in the example Nick gave.

      1. As above, this is normal. Brokers can have a different server time. This effects the candle open time. My candles open at 2am GMT, yours open at a different time. This will lead to candles that look very different.

  3. Hi Nick,
    I took the first and second trade as GBP/AUD is also one of my favorite pairs. Your entry is different to mine but the principle is the same. Thank you Sipho

  4. Hi Nick:
    Awesome strategy, simple and effective. I didn’t take any of those reversals, I took the previous trade on Feb. 25. I went long at 1.9660 and made 140 pips.
    Thank you.

  5. Thanks Nick! I love your analysis and commentary. You have become my favorite trading mentor. Keep up the good work!

  6. I believe you said you are trading off the 3 hour chart on this pair. you usually look at 4 hours and above. Is it typical that you look at different time frames such as this? I don’t want to misquote you but I believe you once said that the shorter the time frame, the less reliable the trades tend to be.

    1. Hi Lloyd, the best way is to switch through your time frames in order to spot the reversal candle. I believe that 3hr will do if the indecision candle is strong and on Support or Resistance

    2. I think Nick glance to 3 hour chart just to confirm and jump in early. But the main strategy remains on the bigger timeframe

    3. Yeah, generally speaking large time frames are more reliable. However, at the moment there aren’t many trades on the large time frames so we have to make do with what we get.

  7. I see some questions about the time frame and chart.

    That is a 4 hour chart off of the cTrader platform. You can see just left of the pricing box a small “H4”
    denoting a 4 hour time chart.

    You can use the online demo at spotware .com and several brokers have cTrader as well thru the FIX Bridge i believe it is called.

    1. Yes, I switched to cTrader recently. It is far and away the best Forex trading platform available. Sadly, 90% of Forex traders will persist in using the ten year old MT4 and not explore the other amazing options out there today.

      1. I’ve just looked at cTrader and didn’t find why is so special.
        That 10 years old MT4 is updated regularly and I can use all indicators coded by me and of course my robots to take care of trades after I’ve entered manually.

      2. Yes, cTrader is a really good platform. I am using it to chart with on one of my screens, but i still use TradeStation at FXCM to enter my trades.

        Another neat platform i have been playing with is the Ninja Trader software.

        It is a pretty neat trading platform too. Yeah, i have never used MT4, i thought it seemed a little dated.

        By the way your advice and knowledge is spot on.

        Very generous of you to share your trading strategy with other folks.

        I trade very similiar, support resistance, Heiken-Ashi and a Rainbow Oscillator usually does the trick.

  8. Nick,
    Thank you for being such a great teacher. You are not on a get rich quick buy my scheme and that is so refreshing in today’s society.

    Would your method be applicable to an index such as FTSE Uk 100 ?

    The world needs more Nicks!

    Thanks ever so,

    Another pupil,
    Chris

    1. Since my strategy is price action based it should work in all markets. Price is dictated by traders and traders move all markets.

  9. Hi Nick,

    Thank you for analysis and the insight you provide.

    You mentioned about jumping out of trades when it looks bad and I was wondering what do you normally look for or do you have a criteria for exiting a trade before the SL hits?

    Sorry if this might be a repeat question.

    Thanks,
    Long

  10. hi this specific site is wonderful i’m keen on reading your content regularly Forex Charts. Sustain the best do the job! You are aware of, nearly everyone is shopping circular because of this info, you can assist them to greatly.

  11. Hi Nick,

    You make it so simple. The truth of it is your method has an edge, therefore with sensible money management you can’t fail but make money.

    I caught the gbpaud 6hr trade last night, woke up to my take profit being hit.

    All the best with your trading

    Thanks for all the help you give freely…

  12. Hi Nick

    Your support and Resistance line page is showing no data. Is this intentional or a glitch?

    Cheers

    Oliver

    1. Hi Nick,

      Same problem as Oliver…I’ve decided to try cTrader and wanted to insert your Support & Resistance lines from your Strategy page so that I could get trading again. Looks like they’ve disappeared.

      Do you still place your S&R lines using the H8 chart?

      Looking forward to viewing last weeks webinar too.

      Thanks for everything .

      Nick C.

  13. My charts close on the 8, 16, & 24th hours so I actually had a nice setup on Thursday after it made the low. Short body, longer wick and it formed right on top of my support line I have set at 1.9312. It opened below and closed above. My trade entered on the next candle just above the previous high and I spent all weekend and yesterday negative up to 104 pips. It has finally gotten positive and I’m hoping for a retrace of a good portion of what it lost the earlier part of the week. Did I misinterpret the setup? Why would you not have entered that trade?

  14. Hi, hey I have a few thousand Aussie dollars to move around. I also have a bank account in the uk. I’m a Brit/Aus. Should i transfer this money to the uk and back again …given the pound is so lo?

    Thanks Lorna

  15. i typed at google…any body trading GBPAUD…and i got your webpage…for me also..GBPAUD is the best all among others…i thought may be i am the only one who like that pair so much but i was in the hope that there may be also some other smart trader may be working with that pair…and yes you are one of them (i am not much smart though….im newbie)
    as far per my analysis…GBPAUD gives the best support and resistance…Best opportunity on the forex world…to earn biggest pips…..one of the most volatile pair of all the time….very balance chart as compare to all others pairs…i tried even EAs on it..they perform more well …drawdown always a bit high cuz of lot of pips generating….but Still very very profitable pair….i wish i could give a bit less drawdown…but it cant be…best wishes all traders here

  16. I follow this pair but , as it is a cross rate , is chart less useful with this one although get double whammy effect at times ?