The trend for GBPAUD has continues to remain negative putting a smile on all those AUD holders who had equally become quite concerned over the previous 6 months when they had lost nearly 10% in value. Over the last month GBPAUD rates have fallen by over 2.5% and I think many who had thought it was a small correction rather than a changing trend will be eating their words now. In my option it seems that this trend is likely to continue in the medium term meaning GBPAUD traders who have been waiting for a SPIKE up may want to review their currency strategy. (To do this with an expert feel free to contact the author via [email protected] directly.)
But when will the peak levels be for buyers and sellers over this coming week?
We have already had a host of economic date today for the UK which continued to miss expectation giving AUD sellers yet more reason to move. The two biggest factors as to why we have seen this fall is both UK data missing targets and the commentary from the FED in the US. It was only last week when the head of the FED suggested that they expect Interest Rates to start climbing early in 2015, around the same time as the UK is also expected to start changing Interest Rates. Previously the UK was by far the leaders and expected to be the first major western country to raise interest rates which have driven a lot of investment into the Pound pushing its value up. Following this commentary and change in forecasts for the USD this has now changed and this artificial boost for the Pound has been unwound and shared with the USD, resulting in one of the worst months for the Pound against a basket of currencies we have seen over a 13 month period.
Later this week we have more news from the UK, Retail Figures on Thursday and GDP Figures on Friday. It seems likely that we will see the GBPAUD end the week lower than where we are now. As a result GBPAUD traders that need to move this week may want to limit their exposure or move sooner rather than later. If however you are a risk taker or have more time you may see an opportunity early next week. This is when we have the start to the new month with profit taking expected. This is when financial institution need to reset their investment levels and recognise profits for their targets. When this happens there is normally a short term change in demand and therefore the value of each currency, similar to the Interest Rate hedge I mentioned above but on a much shorter time frame. SPIKE Notifications and Rate Alerts are the tools to use over this period to help you both maximise your trade and limit your exposure to any negative movement in your situation. Both are free tools that we offer here that can easily be set up once a client has an account open and this in turn is a free no obligation tool, we simply use the application as a sign of intent before we deploy these tools for our client base.
If any of the above is of interest or if you would like to discuss your current currency situation with an expert feel free to contact myself Steve Eakins via my email at [email protected] or by calling on the normal number +0044 1494 787 478