• GBP/AUD strengthened on Monday as sterling kept firm tone ahead of UK CPI.
• UK CPI is expected to show that the annual headline CPI fell to 2.1% in April, down from 3.2% in March.
• The core CPI, which excludes volatile items like food and energy prices, is estimated to have decreased to 3.7% in April from 4.2% the previous month.
• A rally towards is 1.9150 level is possible if GBP/AUD bulls overcome resistance at 38.2%fib.
• Immediate resistance is located at 1.9075(38.2%fib ), any close above will push the pair towards 1.9198(Higher BB).
• Strong support is seen at 1.8993 (50%fib) and break below could take the pair towards 1.8900 (61.8%fib).
Recommendation: Good to buy on dips around 1.9030 with stop loss of 1.8900 and target price of 1.9100
