FxWirePro: GBP/AUD attracts selling interest, vulnerable to more downside

• GBP/AUD pair slipped lower on Friday, extending its recent downside movement as it attracted sustained selling pressure.

• The decline was driven by a combination of intensifying domestic price pressures and softening labor market conditions, which together dampened investor sentiment toward the British pound.

• Rising inflationary concerns in the UK have raised questions about the Bank of England’s ability to maintain tighter monetary policy for an extended period.

• At the same time, recent data pointing to cooling employment trends has further complicated the outlook for rate hikes

• The Bank of England meets next week and is widely expected to cut interest rates by a quarter point to 4%, their lowest in 2-1/2 years.

• Technical are bearish, daily RSI is negative at 36, daily momentum studies  9 and 10 DMAs are trending down. 

• Immediate resistance is located at 2.0610 (SMA 20 ), any close above will push the pair towards 2.0692( 38.2%fib).

• Strong support is seen at 2.0417 (23.6%fib)and break below could take the pair towards 2.0296(Lower BB).

Recommendation: Good to sell on  around 2.0530, with stop loss of 2.0650 and target price of 2.0460