• GBP/AUD gained modestly on Friday amid weaker sentiment toward risk-sensitive currencies such as the Australian dollar.
• British Prime Minister Keir Starmer struggled to retain power after health minister Wes Streeting resigned, as rivals eyed a leadership challenge following Labour’s poor local election results last week.
• Markets are concerned that a new leader may be willing to loosen fiscal policy more, with British government borrowing costs up sharply again and UK bank stocks selling off on Friday.
• Greater Manchester Mayor Andy Burnham has been given a potential route to launch a Labour leadership bid after another party lawmaker offered to resign, allowing Burnham to contest the seat and potentially challenge for the leadership.
• The domestic political turmoil coincided with another rise in energy prices on Friday, as growing evidence showed the Iran war was damaging the economy.
• Immediate resistance is located at 1.8698 (May 13th high), any close above will push the pair towards 1.8778 (38.2%fib)
•Support is seen at 1.8544(23.6%fib) and break below could take the pair towards 1.8517 (Lower BB).
Recommendation: Good to sell around 1.8700, with stop loss of 1.8850 and target price of 1.8630
