• GBP/AUD initially dipped on Wednesday on higher commodity prices but recovered ground as investors ramped up expectations of further rate rise by BoE.
• GBP has been consolidating of late against Australian dollar on increased expectation BoE is expected to hike a further 25bps on Feb 3.
• Currently, the 1.8781 (50% fib) barrier is restricting lower move, will likely be a speed bump to bears.
• Technical signals are bullish as RSI is at 59, daily momentum studies 5, 9 and 10 DMAs are trending north.
• Immediate resistance is located at 1.8851 (38.2% fib), any close above will push the pair towards 1.8936(23.6%fib).
• Strong support is seen at 1.8781 (50% fib) and break below could take the pair towards 1.8740(14DMA).
Recommendation: Good to buy on dips around 1.8800, with stop loss of 1.8700 and target price of 1.8880
