EUR/AUD Rebounds but Stays in a Downtrend | Technical Analysis

EUR/AUD rebounded strongly during the Asian session Wednesday, after it hit support slightly below the 1.6320 territory, which stopped the rate from moving lower between October 1st and 12th. Despite the sharp advance though, the pair continues to trade below a downside resistance line drawn from the high of October 20th, and thus, for now, we would treat the overnight recovery as a corrective phase of the short-term downtrend.

If the bears are willing to take charge again, we could see another test near the 1.6320 zone soon. A break below that zone would confirm a forthcoming lower low and may target the 1.6255 hurdle, marked by the low of September 22nd, the break of which may extend the fall towards the low of the day before, at around 1.6190.

Shifting attention to our short-term oscillators, we see that the RSI rebounded from near its 30 line, while the MACD, although below both its zero and trigger lines, has bottomed. Both indicators detect slowing downside speed and make us cautious that some further recovery may be in the works before the next round of selling, perhaps for another test near the aforementioned downside line.

Nonetheless, we would like to see a break above that line, as well as the 1.6575 barrier, before we start examining the bullish case. Such a move may encourage the buyers to shoot for the 1.6685 obstacle, which is marked as a resistance by the highs of October 28th and 29th. If that level is not able to stop the advance, the next territory to consider as a resistance may be the 1.6780 area, which is near the peak of October 21st.


The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72.57% of retail investor accounts lose money when trading CFDs with the Company. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure.

Copyright 2020 JFD Group Ltd.

interesting to see what this pair will do over the next few weeks. Brexit will have an impact on the EUR so i think thatll be a price driver one way or the other