EUR/AUD Analysis – Euro To Aussie Dollar Heading Towards Support

EUR/AUD Analysis – Euro To Aussie Dollar Heading Towards Support

  • – The Euro declined heavily against the Aussie dollar recently, and moved below the 1.4300 support area.
  • – There are two bearish trend lines on the 4-hours chart of EUR/AUD, acting as a resistance on the upside near 1.4260-1.4300.
  • – Earlier today, the German wholesale price Index released by the Statistisches Bundesamt Deutschland posted an increase of 1.2% in Dec 2016, compared with Nov 2016.

 

German Wholesale Price Index

There was no major economic release in the Euro Area today. The only one to note was the German wholesale price Index by the Statistisches Bundesamt Deutschland. The market was not expecting a rise of more than 0.5% in Dec 2016, compared with Nov 2016.

 

However, the result was better than the forecast, as there was a rise of 1.2% in the German wholesale price Index. Looking at the yearly change, there was a 2.6% rise in the index in Dec 2016, compared with the same month a year ago. The report also added that the “index of selling prices in wholesale trade was down 1.0% on an annual average in 2016 from the preceding year”.

 

Overall, the outcome was above the expectation, and it gives a chance to the Euro buyers to take the EUR/AUD higher for a recover towards 1.4220.

 

EUR/AUD Technical Analysis

The Euro faced a lot of selling pressure against the Aussie dollar during the past few days, as it moved below a couple of important support levels like 1.4400 and 1.4300. The EUR/AUD pair currently looks like in a downtrend with two bearish trend line as resistance on the 4-hours chart near 1.4260-1.4300.

 

EUR/AUD Analysis – Euro To Aussie Dollar

 

The pair already broke the 76.4% Fib retracement level of the last wave from the 1.4090 low to 1.4720 high. So, there is a chance of a full test of the last swing low near 1.4100.

 

The highlighted support area is very important. It acted as a barrier earlier, and may produce a bounce once again from 1.4100. The H4 RSI has also reached the oversold readings, which means the EUR/AUD pair may sooner or later attempt to recover.

 

On the upside, an initial resistance is near 1.4200, followed by the highlighted bearish trend lines.

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