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EURAUD below 20 DMA

Market Analysis
2017-06-07_14-42-48

EURAUD, Daily

EURAUD and most other Australian crosses have been on a weakening path, reflective of a generally firm Aussie dollar after Australian Q1 GDP came in with 0.3% q/q growth, relieving some market fears of there being a negative out-turn following weak capex data. EURAUD presented a down movement since Friday May 2, while today by observing the 4-hour chart, the pair drifted lower to 1.4840.

More interesting is the fact that in a daily time-frame, the pair broke today the 20 Day moving average, despite the general upwards movement in a weekly and monthly basis. This downtrend has been observed for 4 consecutive daily sessions, below the latest down fractal. Meanwhile it is important to mention that Parabolic SAR turned negative yesterday, after being continuously positive since mid-May. Additionally, RSI is at 48 looking that it is likely to reduce further.

Therefore, a SHORT position was taken at 1.4843, since weakness is likely to be continue. Target 1 was set at the lower Bollinger bands, which is at 1.4750. Target 2 was set at 1.4680, which is also the 50-Day EMA. Support at 1.5030.

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Andria Pichidi

Market Analyst

HotForex

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