EUR/AUD Price Forecast: Rallies above 1.6500 amid risk-off mood
- EUR/AUD climbs above the 1.6500 level amid cautious market mood.
- Technical analysis shows potential for further gains with the Relative Strength Index indicating bullish momentum.
- Resistance levels ahead at 1.6575 and 1.6600, with potential targets extending to 1.6759 if upward trajectory continues.
- Support found at 1.6500, with further downside protections at the 100-day and 200-day SMAs at 1.6375 and 1.6359, respectively.
The Euro extended its gains versus the Australian Dollar on Tuesday, amid a session characterized by a risk-off mood, sending high-beta currencies lower. At the time of writing, the EUR/AUD trades at 1.6557 up by 0.40%.
EUR/AUD Price Forecast: Technical outlook
The EUR/AUD has halted its uptrend and has consolidated at around 1.6500 for the last three trading days. Although momentum seems bullish, buyers must clear the October 31 peak of 1.6599 if they want to remain hopeful of extending their gains.
Momentum as depicted by the Relative Strength Index (RSI) favors further upside, with the RSI standing above the neutral level.
If EUR/AUD rises above the December 11 high of 1.6575, it would pave the way for further upside. A breach of the latter will expose 1.6600, followed by the August 15 daily high of 1.6759.
On the flip side, the EUR/AUD first support would be the 1.6500 mark. Once cleared, the next support would be the 100-day Simple Moving Average (SMA) at 1.6375, followed by the 200-day SMA at 1.6359.
EUR/AUD Price Chart – Daily
Euro FAQs
The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
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Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
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