Technical Analysis – EURAUD bullish bias after 3-month high

Posted on April 28, 2017 at 7:25 am GMT by the XM Investment Research Desk

EURAUD is currently down but little changed from the day’s open. The pair posted a three-month high during yesterday’s trading.

The RSI indicator is well into bullish territory, marginally crossing above its 70 overbought level. This is indicative of the bullish bias in place but also renders a near-term reversal a possibility. The MACD histogram adds to the positive short-term picture as it is positive and above its red signal line.

The 1.46 potential psychological level combined with yesterday’s high of 1.4640 could form a resistance area to the upside. If the price climbs above this area, the focus would shift to the five-and-a-half-month high of 1.4721 from December 30 as another important mark.

On the downside, the 1.45 handle could hold some significance and offer support. The same holds for another potential psychological level below it, namely the 1.44 handle. Further down, the 200-day moving average (MA), currently at 1.4336, might offer additional support.

Shifting to the medium-term picture, the price crossing above both the 50- and 200-day MAs could indicate a tilt away from the bearish outlook previously in place due to the downtrend going back more than a year. Also notice that the 50-day MA is currently upward sloping and the 200 one is more or less flat.

Summing up, the short-term bias is bullish and the medium-term is looking mostly neutral at the moment.

Source: www.xm.com