Wyckoff Accumulation in GBPAUD
The pair has been ranging since mid-April.
Since then, the Cable has become stronger while the AUD turned neutral as confirmed by the CFTC Commitment of Traders report.
The net positions for non-commercial traders on the Cable have considerably increased to 33k while the AUD net positions remain sub-zero at -3k.
As a result, there has been accumulation in this pair - printing a text book Wyckoff Accumulation pattern. Currently, price is its last phase where traders are looking for sign of strength.
When traders a looking for SOS—sign of strength, the price advances on increasing spread and relatively higher volume. Often a SOS takes place after a spring, validating the analyst’s interpretation of that prior action.
Personally, the LPS—last point of support, the low point of a reaction or pullback after a SOS, was the prior action that led me to conclude that this is a Wyckoff accumulation pattern. Backing up to an LPS means a pullback to support that was formerly resistance, on diminished spread and volume. On some charts, there may be more than one LPS, despite the ostensibly singular precision of this term.
Therefore, I'll be adding positions right above the 100-week moving average which is a strong level of resistance.
This is an interesting learning moment for traders looking to learn about Wyckoff Accumulation and Distribution
Since then, the Cable has become stronger while the AUD turned neutral as confirmed by the CFTC Commitment of Traders report.
The net positions for non-commercial traders on the Cable have considerably increased to 33k while the AUD net positions remain sub-zero at -3k.
As a result, there has been accumulation in this pair - printing a text book Wyckoff Accumulation pattern. Currently, price is its last phase where traders are looking for sign of strength.
When traders a looking for SOS—sign of strength, the price advances on increasing spread and relatively higher volume. Often a SOS takes place after a spring, validating the analyst’s interpretation of that prior action.
Personally, the LPS—last point of support, the low point of a reaction or pullback after a SOS, was the prior action that led me to conclude that this is a Wyckoff accumulation pattern. Backing up to an LPS means a pullback to support that was formerly resistance, on diminished spread and volume. On some charts, there may be more than one LPS, despite the ostensibly singular precision of this term.
Therefore, I'll be adding positions right above the 100-week moving average which is a strong level of resistance.
This is an interesting learning moment for traders looking to learn about Wyckoff Accumulation and Distribution
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