• GBP/NZD initially dipped on Monday but recovered some ground as investors focus shifted to UK inflation data on Wednesday.
• UK CPI inflation is scheduled to be released on Wednesday and is projected to be 4.4% year on year, down from 4.6% before, with the core CPI figure likely to be 5.5%.
• GBP/NZD remains well below 1.8677( 50%fib),Daily close below 38.2%fib increase the scope for much bigger drop.
• Technical signals are bearish as RSI is heading down at 36, daily momentum studies 5, 9 and 11 DMAs are trending down.
• Immediate resistance is located at 2.0444(50%fib ), any close above will push the pair towards 2.0463 (5DMA).
• Strong support is seen at 2.0371(38.2%fib) and break below could take the pair towards 2.0279(23.6%fib).
Recommendation: Good to sell on around 2.0380 , with stop loss of 2.0500 and target price of 2.0300
