• GBP/AUD declined on Monday as concerns over the solvency of China Evergrande group 3333.HK triggered a sell-off in sterling.
• Sterling’s decline followed a series of weak data that dampened tough expectations from the Bank of England ahead of the MPC rate announcement on Thursday.
• At GMT 18:28, the pair was trading 0.11% lower at 1.8862, lowest since Sep 14th.
• From a technical viewpoint, the moving averages are pointing downwards, while the RSI is strongly bearish at 47.85.
• Immediate resistance is located at 1.8932( 23.6%fib), any close above will push the pair towards 1.9000 ( Higher BB).
• Strong support is seen at 1.8789 (38.2%fib ) and break below could take the pair towards 1.8702 (50% fib).
Recommendation: Good to sell around 1.8860, with stop loss of 1.9000 and target price of 1.8770.
