The Euro (EUR) inched lower against the Australian Dollar (AUD) on Monday, decreasing the price of EURAUD to less than 1.4700 as the pair is undergoing a slow and steady downtrend since last couple of months. The technical bias remains bearish because of a Lower High in the recent upside rally on daily and higher time frames.
Technical Analysis
As of this writing, the pair is being traded near 1.4669. An immediate support may be noted around 1.4471, the confluence of a major horizontal support as well as the low of last week. A break and daily closing below the 1.4471 support area will confirm the bearish bias, validating a dip towards the 1.4345, the low of November 2015.
On the upside, the pair is likely to face a hurdle near 1.4711, a major horizontal resistance area ahead of 1.4894-1.4900, the confluence of various resistance levels such as the high of February 2015 (a key upside rally), the psychological level and the horizontal resistance. Not to mention a break and daily closing above the 1.4711 will put 1.5000 in sight. The technical bias will, however, remain bearish as long as the 1.5645 resistance area is intact.
Trade Idea
Considering the overall technical and fundamental outlook, buying the pair below 1.4471 upon emergence of a valid bullish reversal candle appears to be a good strategy in short to medium term. Conversely, selling EURAUD on short term rallies could also be a good option for intraday trading.
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