Key Takeaways
- Euro slides against the US dollar, but manages to hold ground against the Australian dollar.
- There is a major resistance around the 1.4430 level, which might act as a pivot zone for the pair.
Technical Analysis
There is an important bearish trend line formed on the 4 hour timeframe for the EURAUD pair, which acted as a barrier a number of times. Moreover, the most important point is that the same trend line is now coinciding with the 200 simple moving average (SMA) - 4H. So, the Euro buyers are having a tough time to break the 1.4420-30 resistance area. The pair recently tested the mentioned area, but failed to break it and traded lower. This failure also occurred right around the 61.8% Fibonacci retracement level of the last drop from the 1.4601 high to 1.4201 low. So, technically it holds a lot of importance. However, the pair found buyers around the 50 SMA (4H). Currently, the pair is trading around the 100 SMA (4H), and if it manages to close above the same, then a run towards the 1.4430 resistance zone is very likely. If Euro sellers fail to defend the mentioned resistance area, then a move towards the last high of 1.4601 might be on the cards.
On the downside, the EURAUD pair remains supported by the 50 SMA (4H). Any further losses might take the pair closer to the previous swing zone of 1.4300.
Overall, as long as the pair is trading above the 50 SMA (4H) the chance of a move higher is more compared to a drop lower.
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