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EURAUD: Heading again for 2014 highs

The euro had edged up last week as Greece’s creditors head to Athens for talks over a third deal. Greek lawmakers approved last week a second round of austerity measures demanded to unlock 86 billion euros in much-needed support.

After more signs of a slowdown in the Chinese economy thru its fifth month of  sluggish manufacturing the Australian dollar fell to a fresh six-year low suggesting that China’s real gross domestic product (GDP) growth cycles have become an increasingly important driver of Australia’s nominal GDP growth this last decade.

EURAUD rose last week on an approval of the second set of reforms for Greece and closed in the green near the high of the week, clearing again above a weekly support. The currency is still in a bullish phase and is getting ready again for a push upward to 2014 highs. The stochastic in showing an overbought market but even with the pair well into overbought territory, we should not fight the strong upward trend.

Expecting an upward move to a weekly key level at 1.5422 on a break above previous week high at 1.5104 (scenario 1).