FxWirePro: GBP/AUD trades sideways ahead of BoE decision

• GBP/AUD traded in tight range on Tuesday  as market awaited of a Bank of England rate decision later this week..

• The Bank of England is expected to cut its key rate to 4% on Thursday, with another cut likely by year-end, despite June inflation nearing twice its 2% target.

• Despite June inflation remaining persistently high at nearly double the BoE’s 2% target, policymakers are seen prioritizing support for the struggling UK economy, which has been weighed down by weak consumer spending and tax pressures.  

• Britain borrowed more than expected in June, adding to speculation about the need for new tax hikes by finance minister Rachel Reeves later this year.

•    Technical signals remain bullish, with RSI at 36 and the 5 , 9 , and 11 day moving averages all trending higher.

•      Immediate resistance is located at 2.0591(38.2% fib), any close above will push the pair towards 2.0726 (Higher BB).

•    Strong support is seen at 2.0412(Lower BB) and break below could take the pair towards 2.028623.6% fib).

Recommendation: Good to sell  around 2.0560, with stop loss of 2.0650 and target price of 2.0480