EUR/AUD gyrated higher last week but continued to lose up side moment as see in 4 hour MACD. Further rally is expected as long as 1.6053 support holds. Focus is now on 1.6389/6434 cluster resistance zone. Decisive break there will carry larger bullish implications. However, break of 1.6053 will indicate short term topping and turn bias back to the downside for 1.5848 support and possibly below.
In the bigger picture, focus stays on 1.6389/6434 cluster resistance (38.2% retracement of 1.9799 to 1.4281 at 1.6389). Sustained break there should confirm that whole down trend from 1.9799 (2020 high) has completed. Further rally should then be seen to 61.8% retracement at 1.7691. However, rejection by this cluster resistance will make medium term outlook neutral at best.
In the longer term picture, the strong break above 55 month EMA (now at 1.5616) raised the chance of bullish trend reversal. Firm break of 1.6434 resistance should confirm that the down trend from 1.9799 has completed. It’s still early to decide if the up trend from 1.1602 (2012 low) is resuming. An assessment will be made after rise from 1.4281 reveals more of its structure.
