• GBP/AUD initially dipped on Tuesday but recovered ground as investors remained cautious on risk assets amid growing tensions in Ukraine and bet the Federal Reserve will hike rates.
• Pair traded in a narrow range of 1.8872-1.8910, staying close to yesterday's price.
• Any downside correction is likely to be temporary as barrier at 1.8802 (50%fib) is set to restricting lower move.
• Technical signals are bullish as RSI is at 58, daily momentum studies 5 ,11 and 14 DMA’s are trending up.
• Immediate resistance is located at 1.8903 (38.2%fib ), any close above will push the pair towards 1.8967 (June 24th high).
• Strong support is seen at 1.8859 (5 DMA) and break below could take the pair towards 1.8800 (50%fib).
Recommendation: Good to buy on dips around 1.8860 with stop loss of 1.8800 and target price of 1.8970.
