Nick Nasad
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EUR/AUD: Time for Sharper Retracement?

The EURAUD daily picture is turning bearish in the medium term as the pair.

  • The end of the year saw the pair set-up a double top pattern, which was completed when the pair broke down through 1.53 support and reached a projected move to 1.5120.
  • After recovering for about a week the pair retesting old support as resistance and was pushed back downward.
  • Around this time, the pair also managed to crack an upward sloping support trendline.
  • Today, at the start of a new week, we see renewed strength in favor of the Aussie against the USD, EUR, and GBP, with the EUR/AUD pair slicing through 1.5120 support.
  • Will there be follow through to today's action? The technicals suggest yes. If so, we could be looking at a move towards 1.4750, with initial support at 1.50. If that 1.50 level gives way than a sharper retracement to the upswing seen throughout November/December is certainly a possibility.