AUD/USD and EUR/AUD May Be at Turning Points, Facing Trend Lines
Australian Dollar Technical Forecast
- The Australian Dollar may be at turning points versus USD, EUR
- AUD/USD may test the floor of rising channel as resistance held
- EUR/AUD at turning point, more declines exposes downtrend risk
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AUD/USD Technical Outlook
The Australian Dollar remains in an ascending channel against its US counterpart that took shape in late February. AUD/USD’s recent performance does hint that it could be readying to test the floor of the channel, hinting of cautious losses in the coming days. This is mainly due to near-term resistance holding which is a range between 0.7184 and 0.7207 on the daily chart below.
Whether or not there may be follow through will depend on how support holds. The former descending resistance line from late January (blue dotted line below) could emerge as new support, making for a tough barrier to breach. If the Aussie clears it, the next psychological area seems to be just above 0.7050. Otherwise, breaking through resistance opens the door to testing 0.7235.
AUD/USD Daily Chart
EUR/AUD Technical Outlook
Against the Euro, the Australian Dollar is at a critical turning point. Zooming out on a weekly EUR/AUD chart, the pair is sitting right on a rising trend line going back to February 2017. If broken, this would open the door to potentially entering a dominant downtrend in the medium term. But to get a better idea to see what’s in store for the pair in the near-term, let’s turn our attention to the daily chart.
EUR/AUD Weekly Chart
EUR/AUD is recently closed under near-term support at 1.5722 which is the low achieved back in late January. Prices initially struggled closing under it for most of this month. Still, positive RSI divergence warns that downside momentum is fading and this may precede a turn higher. As such, it will be essential to watch how EUR/AUD performs ahead.
If there is a break under the February 2017 trend line, watch support next at 1.5581. Otherwise, near-term resistance appears to be at 1.5852, the psychological barrier that tamed prices back in the summer of 2018.
For more updates on the Australian Dollar, feel free to follow me on twitter here @ddubrovskyFX.
EUR/AUD Daily Chart
* Charts created in TradingView
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— Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.com
To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter