The EUR/AUD pair is steadily grinding higher. The cross is still respecting a trendline resistance dropped down from 1.7140, thereabouts of May 2020’s highs. This unfolds resistance at 1.6157 and 100-week moving average resistance at 1.6222, Benjamin Wong, Strategist at DBS bank, reports.
EUR/AUD cross is capable of delivering large mileage moves
“The EUR/AUD cross is finally making a reentry back into the Ichimoku clouds on the weekly time frame, which is an encouraging sign for bulls. The issue remains substance over form, as there is quite a bit of topside space to cover. Hence, this is not an absolute signal to be openly elated over an outright bullish outcome.”
“The gradient of support is also gradually pulling higher to 1.5699, which sites the bottom fringe of cloud support on the daily charts.”
“The cross is making slow but steady progress in a rising channel, where it mulls 1.6226 (38.2% Fibonacci retracement of 1.7140-1.5253) and the dropped down resistance from 1.7140 that axes into 1.6157. The former matches the 100-week moving average at 1.6222, and if the cross can haul over 1.6396, higher up rests another Fibonacci driven resistance pegged at 1.6456.”
“We note that there is a resistance block which together with a view that the current advance is corrective, rather than impulsive. This opens up a potential mapping where the cross could still retreat before forging for higher grounds, where we would keep 1.57 lows as a possible area to re-engage the cross.”
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