EURAUD is gaining ground on Monday, remaining above the 1.5710 level, the 23.6% Fibonacci retracement level of the upleg from 1.3620 to 1.6350. The advance in the price action is confirmed by the technical indicators. The RSI is heading upwards above the 50 level, while the stochastic oscillator is ready to create a bullish crossover between the %K and %D lines. Also, the 20- and 40-simple moving averages on the daily chart, are in process of posting a positive cross in the next few sessions, if the price continues the upward movement.
The pair surpassed the 40-day SMA and is extending its gains towards the next immediate resistance obstacle of 1.5880, identified by the latest highs in the preceding week. Moving higher, the bulls might find resistance around 1.5980, taken from the inside swing low on October 2.
If the price drops lower, it could retest the 23.6% Fibonacci of 1.5710 before dropping lower towards the 20-day SMA of 1.5658 at the time of writing. Should the pair breach the latter, bearish action may pick up speed towards the 1.5515 support level, while further declines may bring the previous trough of 1.5345 into view.
Concluding and looking at the long-term timeframe, EURAUD is slightly positive creating higher highs and higher lows during this year. However, in the short-term the pair seems to be in a bearish correction mode.
