•GBP/AUD initially gained on Monday but lost momentum due to risk-off sentiment in thin holiday trading.
• There are no UK data releases scheduled for Tuesday. The next Bank of England meeting is set for February 6.
• The Bank of England implemented two interest rate cuts in 2024, totaling a 50 basis point reduction. Money market participants are now pricing in over 52 basis points of cuts in 2025
• Technical signals are bullish as RSI is at 62, daily momentum studies 5 DMA, 11 DMA’s are trending up.
• Immediate resistance is located at 2.0256 (23.6%fib ), any close above will push the pair towards 2.0350 (Higher BB).
• Strong support is seen at 2.0124 (Daily low) and break below could take the pair towards 2.0058 (50%fib).
Recommendation: Good to buy on dips around 2.0160 with stop loss of 2.0100 and target price of 2.0260.
