EUR/AUD looks ready to bounce from a technical support zone and extend a long-term trend!
Will the pair head for key resistance levels in the next few days?
We’re zooming in on EUR/AUD’s 4-hour chart for clues:
EUR/AUD 4-hour Forex Chart by TradingView
The euro has been seeing mixed price action lately as traders weigh the ECB’s rate cut outlook against upbeat Eurozone data and some cautious optimism on the trade war front.
Meanwhile, the Australian dollar is struggling to find support, pressured by rising U.S.-China trade tensions and mounting global growth worries.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the euro and the Australian dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
EUR/AUD, which has been ranging between 1.8400 and 1.7800 this April, recently bounced off its support zone.
That area isn’t far from the S1 (1.7642) Pivot Point and the 100 SMA on the 4-hour chart!
Watch for bullish candlesticks after the ECB event, as the central bank is expected to strike a cautious tone even while delivering a 25 basis point rate cut.
If EUR/AUD holds above 1.7900 and buyers step in, the pair could make a run for the 1.8000 psychological level, the 1.8099 Pivot Point line, or even the 1.8400 range resistance.
But if bearish pressure kicks in and drags the pair below the 1.7800 weekly lows, a break below the 100 SMA and S1 Pivot Point could open the door for a drop toward the 1.7400–1.7500 zone, near the 200 SMA and the trend line support that’s been in play since late February.
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment!