FxWirePro: GBP/AUD dips ahead of Australian inflation data

• GBP/AUD edged lower  on Tuesday as Australian dollar  firmed ahead of key inflation data.

•   The main catalyst is Australia’s July CPI, due at 0130 GMT. Headline inflation is expected at 3.3% year-on-year, while the trimmed-mean measure, which is closely watched by the RBA, is forecast at 3.5%.

 ·  A hotter-than-expected inflation reading could trigger fresh AUD buying by reinforcing expectations that the RBA may need to tighten policy again. Conversely, a softer print could reduce rate-hike expectations and put pressure on AUD/USD.

·  The RBA’s August minutes showed that policymakers actively considered a 25-basis-point rate hike before unanimously deciding to keep the cash rate at 4.35%.

• Immediate resistance is located at 1.9099(SMA 20), any close above will push the pair towards 1.9229(61.8%fib).

• Immediate support is seen at 1.9024(50%fib) and break below could take the pair towards 1.8969(Lower BB).

Recommendation: Good to sell around 1.9050, with stop loss of 1.9100 and target price of 1.8950