GBPAUD has formed higher lows since August last year and these could be connected by a rising trend line visible on the daily time frame. A test of this support level seems to be underway, and another bounce might follow.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside or that the climb is more likely to gain traction than to reverse. The 100 SMA dynamic support lines up with the rising trend line to add to its strength as support, and the gap between the indicators is widening to reflect stronger bullish momentum.

RSI is still heading lower to show that sellers have the upper hand until oversold conditions are indicated. Stochastic is also pointing down, indicating that bearish momentum is in play, and the oscillator has room to go before reflecting oversold conditions or exhaustion among sellers. Turning back up could confirm that buyers are taking over.

Both the UK and Australia have announced lockdowns in certain localities in order to limit the spread of the COVID-19 virus. The BOE and RBA have also cut rates in order to keep the economy supported, with the latter unveiling an unprecedented QE program as well.

However, worsening updates on the outbreak could still wind up hurting the Australian dollar more as it is also sensitive to overall market sentiment. The good news for now is that gold is ticking higher, which is also bullish for the correlated AUD.

The UK has a few medium-tier reports like the flash PMI readings and CPI figures lined up ahead of the BOE announcement later in the week. Keep in mind, though, that the central bank already cut rates in an emergency announcement earlier on.