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EUR/AUD - Key Levels to Monitor During a Critical Juncture

I believe EUR/AUD has come to a crossroad. It has been bullish since making a low on the year in April at 1.3673. After rallying to 1.5276, we are seeing a bit of bearish correction since last week. This week, this correction accelerated after the RBA sounded more hawkish in its latest monetary policy statement.

EUR/AUD Daily Chart 8/5(click to enlarge)

Here are a couple reasons to fear a bearish move towards the 1.44 area, which would represent the middle of the 2015-range. 
1) Technical: The resistance at 1.5276 goes back to a key pivot in December 2014, and could be a major resistance pivot again in 2015. We are seeing a 3-point bearish divergence between price and the RSI since the June high. Finally, the bearish candle we saw after the RBA reaction is the strongest bearish candle and second strong candle both bullish and bearish since that 2015-low.
2) Fundamental: Central bank outlook is the most important driver of currency movements outside of short-term price action. The shift in RBA tone has the potential to shift EUR/AUD from a bullish to at least a sideways market if not a bearish one. I think at his point, we should limit the bearish outlook in EUR/AUD until we get another hawkish RBA statement. 

Bearish Outlook: For now, a viable bearish outlook for EUR/AUD could be the 1.44 area, in the middle of the 2015-range, and around a key support/resistance pivot. However, this bearish outlook has a huge challenge. A break below 1.4630 will be needed to clear a support pivot and a rising trendline. Then, the 1.44 handle should be in sight, However, even then, there could be upside risk to 1.50. If EUR/AUD is no longer bullish, 1.50 should indeed provide resistance. That would make the 1.44 target very likely. 

Bullish Signs: The reasoning for the bullish case is that the prevailing trend since May is still intact. If price can hold mostly above 1.4650 and thus respect the rising trendline, then EUR/AUD still has pressure on the 1.5276 high. 

EUR/AUD 1H Chart 8/5
(click to enlarge)


A Bullish Attempt: In the 1H chart, we can see that EUR/USD is already trying to form a price bottom against this week's bearish swing. Now, if there is a pullback, let's monitor the 1.4950-1.50 area. If this area provides resistance and price falls back towards the currently forming price bottom, I would anticipate a breakout. To me, failure to climb back above 1.50 would be an additional bearish sign. Then, a break below 1.47 would be an early sign of a bearish correction towards the 1.44 area. 

However, if price can hold above 1.48, and especially if it can climb above 1.50, the bulls are still in control and the prevailing trend is still intact. The 1.5276-1.53 area would then be in sight.