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The GBP/AUD currency is an exotic currency offering song trends and many opportunities for technical pattern traders. While the pair has been trending downward for most of 2011, today we are looking at the potential of a price channel being formed with an upward bias. Traders will use a number of technical cues such as support and the SSD indicator to determine entry timing. Channels are drawn by first finding support and resistance. Support can be found by matching up our lows. Currently our lowest low was printed on July 28th at 1.4759. We can match this point up with the September 7th and October 18th lows to form the base of our channel. Resistance is drawn by using a parallel bar marking off our highs in a similar fashion.
After finding support and resistance, we can now begin to look for entry’s on our channel. Adding the SSD Indicator (Slow Stochastics) with a 15, 5, 5 setting can be useful for finding shifts of momentum. Traders looking to buy the GBP/AUD will look for the %K line to close above the %D line. For more on this oscillator read, Stochastic Crossovers , linked here. 
My preference is to buy the GBP/AUD using conformation from the SSD indicator. Entrys should be placed as near resistance as possible at 1.5450 or better. Stops should be placed 200 points away outside of resistance at 1.5250. Limits should look to first target half the channel at 1.5850 for a clear 1:2 Risk/Reward setting. Secondary limits may be placed at the channel high at 1.6250 Alternative scenarios include price breaking through support and moving on to new lows. Additional Resources Support and Resistance Video Trading Stochastics Video Chart Patterns and the Trend ---Written by Walker England, Trading Instructor To contact Walker, email wengland@fxcm.com. Follow me on Twitter at @WEnglandFX. To be added to Walker’s e-mail distribution list, send an email with the subject line “Distribution List” to wengland@fxcm.com. 
The AUD/JPY has steadily been progressing to lower lows from its April 2011 high at 90.02. From this point the pair has moved down as much as 19% lower to its October 4th low of 72.69. Currently the pair has surged higher six out of the last eight days to test resistance near 79.25. As prices approach this point trend traders can look to enter in with the broader daily move. 
Taking Price in to an 8Hour chart we can see resistance above 80.16 on the AUD/JPY by utilizing a 200 MVA. Price has continued to trade under this line of resistance dating back to July of 2011. Moving into its fourth month of a downtrend, we will begin looking to trade the AUD/JPY short with the trend by utilizing the MACD indicator. Potential signals for entry will include the MACD and Signal line crossing above the zero line. 
My preference is to sell the AUD/JPY on a crossover of the MACD & Signal line. Orders should be placed to sell the AUD/JPY as near resistance as possible at 80.00. Stops should be placed over resistance near 82.00. Limits should be placed at 76.00 for a clear 1:2 risk reward ratio. A second long term target may be placed at 70.175 on a breakout to new lows. Alternative scenarios include price breaking through resistance and price challenging Sept 2011 highs. Additional Resources Trading with MACD Identifying the Trend Money Management --- Written by Walker England , To contact Walker , please email http://Instructor@dailyfx.com/. You can follow on Walker onTwitter @WEnglandFX. To be added to Walkers’ distribution list, please send an email with the subject line “Notification,” to WEngland@fxcm. 
Trading a pricing range is an opportunity outlined once we have defined support and resistance. Resistance is outlined above at our .618 fib retracement near .8874. Support is found by matching up our Septermber 12th and October 3rd lows at .8525. Trading the range we can place entry’s near resistance and look for limits to turn back toward support. Further confirmation can be used by placing an oscillator such as MACD, CCI or RSI looking for a turn from overbought levels. 
My preference is to place entry’s to sell the EUR/GBP next to resistance at .8888. Stops should be placed above resistance near the psychological .900 point. Limits should target the bottom of the range at .8540 for a near 1:3 Risk/Reward setting. Alternative scenarios include price breaking through resistance and moving up to new highs. Additional Resources Support and Resistance Video Money Management Video JW Ranger Strategy ---Written by Walker England, Trading Instructor To contact Walker, email wengland@fxcm.com. Follow me on Twitter at @WEnglandFX. To be added to Walker’s e-mail distribution list, send an email with the subject line “Distribution List” to wengland@fxcm.com.