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EURAUD Technical Analysis | The weekly uptrend continues
BY Janne Muta
|November 14, 2023EURAUD Technical Analysis - The EURAUD currency pair created a higher swing low and rallied strongly after the RBA rate hike came in line with expectations. With the Chinese PMI data already showing Australia's main trade partner in contraction (PMIs below 50) the AUD sold off against the dollar and the euro.
The move was further helped by the German 2-year bund yields moving decisively higher which supported the EUR. As a result, we have yet another higher swing low in the EURAUD after a strong 2.3% rally in the pair. The low NAB Business Confidence reading boosted the rally further intraday today.
Summary of this EURAUD technical analysis report
- EURAUD has remained inside the bullish trend channel we have focused on in the recent EURAUD technical analysis reports. The most recent correction was met with buying at the channel low and now the market is once again trying to push beyond the 1.6845 resistance level.
- The strong 2.3% rally from the latest higher swing low indicates buying interest in this market. The nearest key support level is at yesterday's low (1.6739) while the nearest support level below it can be found at 1.6540.
- After the RBA rate hike came in line with expectations AUD became under pressure with the Chinese PMI data already showing Australia's main trade partner is in contraction (PMIs below 50).
Read our full EURAUD technical analysis report below.
EURAUD Technical Analysis
EURAUD Technical Analysis, Weekly
EURAUD has remained inside the bullish trend channel we have focused on in the recent EURAUD technical analysis reports. The most recent correction was met with buying at the channel low and now the market is once again trying to push beyond the 1.6845 resistance level.
The higher swing low at 1.6456 indicates the market could be strong enough to overcome the supply at this key weekly resistance level. This could open the way to the 1.7064 high. A failure to break above the 1.6845 would imply a move towards the bull channel low could be likely.
EURAUD Technical Analysis, Daily
The strong 2.3% rally from the latest higher swing low indicates buying interest in this market. The nearest key support level is at yesterday's low (1.6739) while the nearest support level below it can be found at 1.6540.
If the 1.6739 level breaks, look for a move to the moving averages (1.6628 - 1.6682). Today's move higher has been strong and if the strength continues above the 1.6845 level, the market could move to the August high (1.7064).
Indicator-based EURAUD technical analysis suggests that the market is overbought near the 1.6845 resistance level. However, the higher weekly swing low could lead to the market breaking beyond this resistance level.
The key for the market sentiment in the near term is whether the EURAUD pair will be able to attract more buyers above the 1.6845. Should the intraday timeframes indicate sustained buying above the level a move to the August high might be likely.
EURAUD Technical Analysis, 8h
The 8h chart reveals another key support level below yesterday's low. A market structure level at 1.6664 is closely aligned with the SMA(50) while the SMA(20) is relatively close by.
This technical confluence level is inside the 1.6628 - 1.6682 range we referred to in the daily timeframe EURAUD technical analysis. The level could come into play should there be a decisive move below the 1.6739 support level. The next key price level below 1.6664 is a pivotal low at 1.6572.
Client sentiment analysis
TIOmarkets clients are bearish on EURAUD with 67% of clients holding short positions and 33% holding long positions in the market.
Please remember that the retail trader client sentiment is a contrarian indicator as most of the retail traders are on average betting against the market trends. This is why, experienced traders tend to trade against the retail client sentiment. You can follow the TIOmarkets client sentiment live on our Forex dashboard.
The Next Key Risk Events
- Australian Wage Price Index
- Australian Employment Change
- Australian Unemployment Rate
- ECB President Lagarde's Speech
- Australian Monetary Policy Meeting Minutes
Potential EURAUD market moves
The nearest key support level is at yesterday's low (1.6739) while the nearest support level below it can be found at 1.6540. If the 1.6739 level breaks, look for a move to the moving averages (1.6628 - 1.6682). Today's move higher has been strong and if the strength continues above the 1.6845 level, the market could move to the August high (1.7064).
How would you trade EURAUD today?
I hope this fundamental and technical analysis of EURAUD helps you make better informed trading decisions. Check the latest market analysis for other instruments and subscribe to receive them in your inbox as soon as they are published
While research has been undertaken to compile the above content, it remains an informational and educational piece only. None of the content provided constitutes any form of investment advice.
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DISCLAIMER: TIO Markets offers an exclusively execution-only service. The views expressed are for information purposes only. None of the content provided constitutes any form of investment advice. The comments are made available purely for educational and marketing purposes and do NOT constitute advice or investment recommendation (and should not be considered as such) and do not in any way constitute an invitation to acquire any financial instrument or product. TIOmarkets and its affiliates and consultants are not liable for any damages that may be caused by individual comments or statements by TIOmarkets analysis 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/her investment decisions. 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 any legal requirements for financial analysis and must, therefore, be viewed by the reader as marketing information. TIOmarkets prohibits duplication or publication without explicit approval.
Janne Muta holds an M.Sc in finance and has over 20 years experience in analysing and trading the financial markets.
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