View previous post: GBPAUD remains within buy-the-dip territory
Since the previous analysis we can confirm the retracement did not travel as far as I had expected, instead returning to test the highs following today's dire PMI data from China.
Now we have broken to new highs it is possible we are about to remain above the original breakout level (the neckline) and confirm the Inverted H&S pattern, which is bullish in an uptrend.
We can seek any retracements on lower timeframes to trade bullish setups. Ideally we'll retest 2.126 and build a base here where European and US traders are still to react to the Chine PMI data.
As we remain within a clearly defined bullish trend then this remains firmly in 'buy the dip' territory in line with bullish momentum.
A break below 2.216 invalidates the inverted h&s pattern but the bias remains bullish as long as we can remain above the 2.102 swing low. Even if price were to break below here (less favoured outcome) we still have the lower bullish channel to consider buy set-ups as we kick things off next week.