EUR/AUD poised to recover

Note: This section contains information in English only.
Source: Dukascopy Bank SA
EUR/AUD recovered following an extensive downfall over the period of 2009-2012. The pair at first sketched a rising wedge, just to break it and target the 23.60% Fibonacci retracement and dash through some of the major pitchfork levels. The current uptrend set a ground at 1.1732 and is working on abandoning it for good, and regardless of the bearish nature of the most recent breakout, the short and medium-term outlook maintains risks on the upside rather than below. The wedge could, however, reverse the market on a larger scale.

Monthly Chart:
© Dukascopy Bank SA


 First of all, the weekly chart shows that the rate has hit a cluster of various technical indicators which is likely to limit access to levels lying below. The area is bound by 1.4102 and 1.4066 and consists of both price and timing levels, suggesting that the surge should start immediately. Secondly, the falling wedge formation is a bullish pattern, which is most likely to break to the upside, rather than to the downside, which sets the first level to beat around 1.4487, the upper boundary of the wedge. A Gann period sketches a quite likely scenario for the movement that could lead at least towards the aforementioned trend-line mid-February. 

Weekly Chart:
© Dukascopy Bank SA


Moving on to shorter-term charts, we can see that the recent downfall has moved on to a motion of lesser steepness, simultaneously breaking the pitchfork. The rate stuck to the parallels for a while, but now shows signs that it might be ready to step over the 100% line. The next short-term target could lie at 1.4796/1.4692, between the Fibonacci retracement and expansion after the wedge trend-line is reached. Due to a possible retracement of the broken line, the pair is most likely to cut its gains at the area and dip before and extensive rally is established.  

Daily Chart:
© Dukascopy Bank SA


In addition, the hourly chart shows a solid channel up pattern with a perfectly healthy location inside the most recent pitchfork. Even though the pair is supposed to now target the bottom trend-line of the channel pattern, the median line of the pitchfork appears to be rather sticky and could lead to a repeated test of 1.4293, the upper boundary of the channel. To the downside, 1.4177 could be a decent target for the next few days, given that the trend-line is there strengthened by a pitchfork parallel.

Hourly Chart:
© Dukascopy Bank SA

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