22 May 2015
EUR/AUD: Downside channel threatens 1.40 handle
FXStreet (Guatemala) - EUR/AUD is currently trading at 1.4061 with a high of 1.4084 and a low of 1.4057.
EUR/AUD has had a bumpy ride this month so far and is no better or worse off however as we come to the closing of this week's business in Asia when looking back. We have been in a range between 1.3910 and 1.4350 post the rally that commenced back in late April from 1.3680 up to aforementioned 1.4350's.
The euro is dictating the play in the cross while the ECB's measures to front load the QE programme this summer is leaving a bearish bias over the unit which could see flows in to Aussie denominated assets and ultimately support the Aussie, especially if we begin to see a shift in sentiment in respect to the domestic economy.
Next week will bring Capex as key focus for the Australian dollar, which may offer the RBA more time to pause given the weakness of the currency and lower borrowing costs in the economy. Such an outcome could support the Aussie as well. Technically, we are in a bearish channel on the short term time frames, and zooming in, 1.4020 is not out of reach here on a continued downside drift to break the ascending support line from 1.3994 guarding space to key 1.3910/30. A break below here would alleviate the upside pressure of the April rally.
EUR/AUD has had a bumpy ride this month so far and is no better or worse off however as we come to the closing of this week's business in Asia when looking back. We have been in a range between 1.3910 and 1.4350 post the rally that commenced back in late April from 1.3680 up to aforementioned 1.4350's.
The euro is dictating the play in the cross while the ECB's measures to front load the QE programme this summer is leaving a bearish bias over the unit which could see flows in to Aussie denominated assets and ultimately support the Aussie, especially if we begin to see a shift in sentiment in respect to the domestic economy.
Next week will bring Capex as key focus for the Australian dollar, which may offer the RBA more time to pause given the weakness of the currency and lower borrowing costs in the economy. Such an outcome could support the Aussie as well. Technically, we are in a bearish channel on the short term time frames, and zooming in, 1.4020 is not out of reach here on a continued downside drift to break the ascending support line from 1.3994 guarding space to key 1.3910/30. A break below here would alleviate the upside pressure of the April rally.