• GBP/AUD strengthened on Monday as risk sensitive Australian dollar weakened ahead of upcoming RBA rate decision.
• All eyes are on Australia this week as the Reserve Bank of Australia meets to set its next monetary policy. With inflation cooling and growth slowing, most analysts forecast a 25 basis point cut to the cash rate marking the third cut in this cycle.
• Beyond the headline rate move, investors will dissect the RBA’s statement and Governor’s remarks for clues on future easing.
• A strong majority of economists predicted the RBA will cut its official cash rate , opens new tab by 25 basis points to 3.60% at the end of its two-day meeting on July 8.
• Technical indicators remain firmly bullish, with the RSI at 67 and both the 9- and 11-day moving averages trending upward, reinforcing positive momentum.
• Immediate resistance is located at 2.1023(50% fib), any close above will push the pair towards 2.1095 (Higher B).
• Strong support is seen at 2.0807(SMA 20) and break below could take the pair towards 2.0609(61.8%fib).
Recommendation: Good to buy around 2.0920, with stop loss of 2.0860 and target price of 2.1000
