EUR/AUD traded lower yesterday, hit support at 1.4815, and then it rebounded somewhat. That said, today, the rate came back under selling interest. Overall, the price structure remains of lower highs and lower lows since May 26th, and thus, we would consider the short-term outlook to be negative.
A clear break below 1.4815 would confirm a forthcoming lower low and could pave the way towards the 1.4715 territory, marked as a support by the low of May 3rd. If the bears are not willing to stop there, then a break lower could see scope for larger extensions, perhaps towards the low of May 4th, at around 1.4600. Another dip, below 1.4600, could target the 1.4555 barrier, marked by the lows of April 20th and 21st, or the 1.4485 zone, defined as a support by the low of April 12th.
Shifting attention to our short-term oscillators, we see that the RSI, already below 50, has turned down again, while the MACD lies below both its zero and trigger lines, pointing south as well. Both indicators detect strong downside speed and support the notion for further declines in this exchange rate.
We will abandon the bearish case, only if we see a strong rebound back above the 1.4960 zone, defined as a resistance by the high of June 1st. This will confirm a forthcoming higher high on the 4-hour chart and may initially target the 1.5055 level, marked by the inside swing low of May 26th, the break of which could aim for the high of that same day, at around 1.5160. If the bulls do not stop there either, then we could see them climbing to the 1.5280 zone, marked by the highs of May 10th and 11th.
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