Trading GBP/AUD

The GBP/AUD is a desirable currency pair for forex trading offering high liquidity and volatility. Making accurate predictions about the exchange rate requires understanding live chart setups and keeping an eye on the news. Here we’ll review the pair and cover why the GBP/AUD FX rate fluctuates, how to use graph data to perform technical analysis and the history of the currencies.

GBP/AUD Trading Brokers

Forex.com are a leading forex broker. Offering the largest range of currency pairs (80+) and some of the tightest spreads in the industry.
NinjaTrader offer Traders Futures and Forex trading. Use Auto-trade algorithmic strategies and configure your own trading platform, and trade at the lowest costs.
The leading US trading Exchange. Nadex offer genuine exchange trading to US clients on Binary Options. Fully regulated by the CFTC.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
Use digital options to take straightforward buy and sell positions on a range of currencies.
Trade with leverage on the FX market.
Zulutrade provide multiple automation and copy trading options across forex, indices, stocks, cryptocurrency and commodities markets
IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.
One of the largest discount brokers in the US, with a fixed trading commission and access to a large array of trading products and securities
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Why Trade GBP/AUD

Many traders opt to buy or sell GBP/AUD each day, and there are several reasons to do so:

  • Volatility – Price chart movement can be large with this pair, and the spot rate can change with little notice. Experienced traders closely monitoring the live exchange rate can use this to their advantage and gain pips from the effect on spread values.
  • Diversification – Choosing to trade on a non-major pair (i.e. without USD) allows forex investors to branch out and utilise distinct strategies to turn a profit.
  • Range of financial instruments – The volume of the forex market is extensive, thus investors can trade the GBP/AUD through many vehicles including options, ETFs and futures.
  • Accessibility of information – GBP/AUD historical data is now freely available, and this makes investing straightforward. Traders can analyse 5, 10, or 20-year long term charts or look at market sentiment over the last 7 days easily. Commentary and discussion forums also help new forex players make sell or buy decisions.

Risks Of Trading GBP/AUD

  • Volatility – The large and sometimes unpredictable price changes in GBP/AUD can be difficult for beginners. And relying on a live currency rate forecast may not be enough to ensure success. Technical knowledge, such as pivot points and support/resistance levels, can prove key for achieving profits on volatile pairs.
  • Complicated technical analysis – In today’s climate GBP/AUD dollar traders regularly use complex conversion tools and indicators, for example, Elliott Wave analysis to make long-term forecasts or projections for next week. Traders often have to be proficient in using chart analysis to compete against professionals and institutions who operate in the same market.
  • Algorithmic trading bots – Using programs that provide automated GBP/AUD trading is now a common strategy, and so investors working manually must respond rapidly to market changes to stay competitive.

Factors Affecting GBP/AUD Price

To make an accurate GBP/AUD trend prediction for today, or forecast for 2021 and beyond, it’s important to understand how price can be affected by economics and local events:

  • Commodity exportation – Australia is a huge exporter of products such as iron ore, coal, natural gas, and gold. As such, commodity prices influence the strength of the Australian dollar and thus the GBP vs AUD.
  • Central bank monetary policy – Interest rates set by these institutions, along with any policy announcements, heavily affect GBP/AUD outlook.
  • Economic performance – The average exchange rate is likely to shift when economic growth is greater in one country, as this strengthens its currency.

Linked Currency Pairs

In addition to these known influences, GBP/AUD followers can also use the behaviour of other currency pairs to provide real-time trading signals and ideas. This is because many currency pairs are correlated, and the price movement in one set can result in either change in the same direction (positive correlation) or opposite direction (negative correlation) in the other set:

  • EUR/AUD – Traders may commonly see a positive correlation between the prices of GBP/AUD and this FX pair
  • AUD/USD – Prices for this currency pair are usually the reverse of the movements seen in GBP/AUD

GBP/AUD Day Trading Strategy Considerations

Forex traders today need to know the pip value of the currencies they are working with, but above that must be aware of world events and use all available data to their advantage.

News

Political and world events can greatly impact the GBP v AUD exchange rate, and so traders should stay up to date with breaking news for their country and currency of interest. Local news outlets in respective countries, such as the BBC in the UK, offer real-time access to live announcements.

Brokers

Many firms offer GBP against AUD for forex trading, such as IG and Oanda. Brokers have different trading platforms (like MT4) that offer various tools and analytical capabilities, and so the investors’ choice is critical to determine the resources they will have access to.

DailyFX, TradingView, Reuters, and Yahoo Finance are popular choices for GBP to AUD research. They provide weekly outlooks, monthly averages, and mid-market rate information, plus interactive charts. Banks like HSBC, Westpac, and Interbank can also be useful resources for live graphs and changes in the exchange rate over time.

Forecasts

Many GBP vs AUD investors use long-term FX forecasts to inform their strategy – for example, a graph of 10 years may calculate a trend of annual fluctuations and thus when a large investment might be appropriate. Equally a GBP to AUD 5 year forecast can display medium-range mood and might predict the average rate over this period. These sentiment tools can also be used more close range, e.g. for the week ahead or today.

Trade

There is a long history of trade between the UK and Australia. The UK is Australia’s 8th largest two-way trading partner, and the second-largest source of foreign investment in the country.

The pound had been a unit of currency since the 8th century and became a free-floating currency in 1971. The Australian pound was replaced by the dollar in 1966, which was then floated in 1983.

The highest exchange rate for GBP into AUD was recorded at $3.028 in September 2001 when the UK’s financial sector was buoyant and its economy robust. The GBP v AUD dollars price fell to its lowest rate of $1.361 in January 1985 when the AUD was strongest.

Historical Data

Investors in GBP to AUD should consider reviewing historical data. Traders can track price changes across a range of time periods, e.g. data from yesterday, the last 6 or 12 months, or even a 5-year history. Many financial clients choose to view this information as a candlestick chart, which clearly depicts any movement information, and can be used to visualise potential trends going forward.

Role Of GBP

The GBP is the oldest and fourth most traded currency in forex. The US dollar, and to a lesser extent the euro, are considered as the world’s unofficial reserve currencies. However, the pound is also held in reserve along with the Swiss franc and Japanese yen, indicating the important role it plays in the world economy.

Trading GBP/AUD

In recent times, the value of the pound against other currencies fell sharply around the 2016 Brexit referendum. Rates have since mostly recovered, however political fallout from a ‘no-deal’ continues to affect the pound’s value.

Role Of AUD

The AUD follows the GBP as the fifth most traded currency on the forex market. With Australia being a key exporter, its rate is strongly influenced by commodity prices. Australia has close proximity to Asian economies, especially China with its booming manufacturing sector and high requirement for resources. As such the AUD rate is heavily dependent on the degree of manufacturing output from these countries. As this has fallen due to the global coronavirus outbreak in 2020, the Australian dollar price has been negatively impacted.

Day trading GBP/AUD

Final Word On Trading GBP/AUD

Forex investors trading GBP/AUD enjoy a volatile currency outside of the major pairs. Traders should use live exchange rate charts and technical analysis to make the most profit from this pair. Investors also benefit from monitoring market news to pre-empt events that could affect the rate of GBP vs AUD.

FAQ

How do I start trading the GBP/AUD?

Investors will need to open a trading account with a forex broker to start buying and selling the currency pair. Look for a provider with tight spreads, leveraged trading and user-friendly analysis tools.

Is GBP going up or down vs the AUD?

Rates are affected by many factors and can move rapidly so be sure to check the most up-to-date news outlets and live charts for forecasts. Most top forex brokers offer a range of real-time trading tools.

Why is the AUD weak against the GBP?

Like many economies, Australia has been affected by the coronavirus in 2021. As the Australian dollar value is influenced by the exportation of commodities like coal for manufacturing, it has fallen as demand for these products has reduced in the wake of COVID-19.

Is AUD getting stronger against the GBP?

The GBP/AUD exchange rate fluctuates daily. Following COVID-19, the Australian dollar slowly recovered but experienced setbacks from announcements of local lockdowns that negatively impacted the value of the AUD.

Is it a good time to buy GBP/AUD?

Although the value of the GBP has been rising against a number of major currencies in recent years, geopolitical events and changes to commodity exports in Australia can impact the strength of the currencies. Conduct your own research before you take a position.