EUR/AUD 1H Chart: Channel Up

Source: Dukascopy Bank SA
© Dukascopy Bank SA
The latest recovery from 1.4440 is the result of EUR/AUD probing and confirming the 45-month up-trend. Accordingly, our outlook on the pair is bullish, and we expect the Euro to keep appreciating against the Australian Dollar. The current distribution between the longs and shorts also favours a rally, being that as many as three fourths of all traders are short the single currency, and there is little room for new sellers to enter the market. However, the upside is limited by a falling resistance line that connects 2008 and 2015 highs, meaning we are highly unlikely to see the exchange rate above 1.58 any time in the foreseeable future. In the meantime, the technical indicators are mixed and support neither scenario.
© Dukascopy Bank SA
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