EURAUD Weekly Technical Outlook
The EURAUD market has been operating within the 1.59250 /1.64055 zone in somewhat a sideways fashion since May 2019. On the monthly time frame, the zone is within the 50 Fib retracement of the drop from the 2.05895 high in February 2009 to the 1.16040 low in August 2012. Based on the fact that the rising trendline (red) from more recent market operations has not been broken down in spite of recent bearish attempts, it is apparent that there is still room for further northward move.
On the weekly time frame, three weeks ago a bearish breakdown of the rising trendline (red) seen on the monthly time frame was attempted and continued by another bearish candlestick two weeks ago. But last week, bulls seized the initiative and effected a northward move taking price action back to hit the trendline. Should bulls succeed in making a follow-through this week, we may see a further northward drive above the trendline.
On the daily time frame, recent price action is operating within a rising wedge (blue) but a falling trendline (magenta) is still in play as resistance. Presently, price action is operating below the trendline, with a relatively big bullish candlestick printed on Thursday advancing just a few pips below it. Friday saw price action printing a relatively small bearish candlestick in reaction. We should await how price action handles the trendline in the early part of this week.
Recent price action on the H4 time frame is operating around the 61.8 Fib zone of the most recent downleg from the high of October 16, 2019 to the low of November 7, 2019. Price operation since November 14 has been influenced mainly by bears and we may see bears continue the initiative to target the rising trendline (gold) still in play as resistance. But its significant breakdown on a daily closing basis is likely to give impetus for a bearish continuation. However, any bullish initiative is likely to target the next horizontal resistance around 1,62925/1.63240 (magenta). The area is in confluence with the 78.6 Fib zone and technically more amenable to a southward turnaround.
My bias in the short-term is bullish. However, I will look for a sell trading opportunity should bulls take market operation to an area of value, say the 1,62925/1.63240 zone (magenta).
I may be wrong. Trade safe and prosper.