EUR/AUD Is Aiming For Higher Levels In The Short Term
Vladimir Ribakov | Mar 04, 2014 05:24AM ET
Today we will discuss the EUR/AUD pair, and the possible trade opportunities. The pair as expected reached the 1.5450 level during the last week. The pair has retraced some of the recent gains. However, I think the bullish trend is still intact for the pair, and it might continue to trade higher from the current or a bit lower levels. So, I think we should be looking for buy opportunities in the short term.
Looking at the 4 hour chart of EUR/AUD, there is an up-move trend line, as shown in the chart below. There is also a support at around the 1.5300 level. If the pair moves closer to the trend line and support level and forms a bullish divergence, then we can jump into a buy trade. Remember, this setup is only valid until the pair is trading above the trend line and mentioned support level.
Initial target should be around the last high, and final target could be around the 1.5600/50 levels. Stop should be placed below the up-move trend line.
Reviewing yesterday’s events and trades
Yesterday’s economic docket was heavy, as many fundamental releases were scheduled. During the European session, the German, French, Italian, Spanish, UK and Euro zone manufacturing PMI’s were released. The outcome was on the positive side, as the Euro zone and the UK’s manufacturing PMI’s came better than expected. However, the EUR/USD and GBP/USD pairs were unable to gain bids, as the tension in the Ukraine is advancing, and global markets fear of a crisis. The risk correlated currencies were seen on the back foot, and the global equities also came under pressure in the late NY session. The US ISM manufacturing index was also released in the NY session, which came better than expected with a reading of 53.2.
Fundamental Outlook for the day
Today, the economic calendar is light, and does not contain any major market moving event. However, we need to keep a close eye on the developments from the Ukraine, as any major news might cause heavy movements in the market. There are some low-risk events scheduled during the day, including the Spanish unemployment data, the Euro zone PPI data and the Investor’s Business Daily (IBD) TechnoMetrica Institute of Policy and Politics (TIPP) Economic Optimism Index. Later, in the next Asian session, the Australia’s GDP figures will be released, which can cause some swing moves for the AUD pairs.
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This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: EUR/USD, EUR/CHF, USD/CAD, USD/JPY, GOLD and OIL.
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