The wedge on the daily chart suggests that a downward breakout could take place sooner rather than later, setting 1.4567, the triangle support level, as its next target. What casts doubt on the prospect of a broken support line is the fact that the wedge had to violate the bottom trend-line or at least lose more volume in the beginning of September. This implies that the market might be ranging more than trending, while keeping a general downtrend in perspective. The rate's location inside of a red Ichimoku cloud adds ground to this presumption. Whether this is true could become clear today already, when the closing price will settle above or below the lower wedge trend-line.
Weekly Chart
© Dukascopy Bank SA
Risks from upside cause uncertainty
In case the rate is indeed on its way towards the lower triangle trend-line, it will at first have to breach the monthly Pivot Point and wedge bottom trend-line cluster around 1.4720/26 where it would face an obstacle at 1.4595 just before the trend-line reveals itself for downside tests.
EUR/AUD has remained a target for bulls with SWFX sentiment showing a 63% preponderance of long positions in the market, while aggregate technical indicators are divided between signals North and East.
Daily Chart
© Dukascopy Bank SA
What brings more upside risks into the picture is the consistency with which Tenkan-sen has remained above Kijun-sen even during the recent downtrend. If the pair gathers enough strength to at least continue its way inside of the wedge pattern, the broken senior uptrend at 1.4873 will remain the toughest level, and if broken, a rally is likely to push the rate through the rest of the wedge to ultimately battle 1.5048, the upper pattern trend-line.
Aggregate Technical Indicators
© Dukascopy Bank SA
Dramatic volatility in perspective
Along with Draghi's and Lowe's speech on Thursday, September 22, a series of fundamental data such as various Flash Manufacturing PMIs and Consumer Confidence indices on Friday, September 23, are likely to make the market unpredictable, causing our trust to shift on fundamental analyst expectations and not technical ones over the next few days. Broken patterns and trend-lines may lose their technical implications until markets calm.