• GBP/AUD initially gained after UK CPI data but gave up ground as diverging U.S.-UK monetary policy weighed on sterling.
•U.S.-UK rates are expected to diverge , any rallies is likely serve as a selling opportunity unless the BoE becomes more aggressive or the Fed indicates a pivot to easier policy.
• The pair pulled back from the 1.7216(Higher BB) and is approaching the 38.2% fibonacci support level at 1.7086, break below will accelerate downside towards 1.7000 level.
• Technical signals are bearish as RSI has turned flat, daily momentum studies 30 and 50 DMA’s are trending down.
• Immediate resistance is located at 1.7158( Higher BB), any close above will push the pair towards 1.7259( 50%fib).
• Immediate support is seen at 1.7086(38.2% fib) and break below could take the pair towards 1.7029(5DMA).
Recommendation: Good to sell around 1.7100, with stop loss of 1.7180 and target price of 1.7020
