The pair is showing high volatility as we can see that it is making both side movements on the daily chart. Presently it is trading and sustaining above the moving average lines which is generating bullish signal for the time being and two consecutive bullish marabuzo candlesticks are providing strength to the bulls.
By looking at the daily technical chart we can see that bulls have taken the charge and they are trying to take it towards north side. From a technical standpoint, a rounding bottom pattern has been formed on the daily chart which is suggesting us that bulls will arrive at 1.6350-1.6400 level at least.
A short term uptrend line is also lying on the daily chart which is providing strength to the bulls. A daily closing above the 1.6100 level will open the way towards the 1.6200 and 1.6300 level. Odds are in favor of bulls and intraday bias remains bullish on the pair as long as 1.5900 levels remains intact.
The way bulls are reacting it seems like bulls have snatched the bite from bear’s mouth and it’s a clear indication of trend reversal i.e. pair has bottomed out. Traders need to pay close attention to the overall risk appetite in the markets when trading the EUR/AUD pair. Risk currencies have not been well supported by developments in international trade policies, which could continue to weigh on NZD and AUD. Only if the EUR/AUD pair manages to form a bullish reversal candlestick pattern with today’s close then we can consider further long the pair.
Shifting attention to our short-term oscillators, we see that the RSI turned upside after it hit its respective downside resistance line, and then crossed above 50, while the MACD, already given a bullish crossover from the over sold territory. The 1.5800 is immediate support level followed by 1.5700 level whereas 1.6200 level is immediate resistance level followed by 1.6350.