• EUR/AUD firmed on Wednesday as Australian dollar weakened as risk sentiment deteriorated despite signs of progress in U.S.-Iran peace negotiations.
• The Australian dollar has also come under pressure from broad weakness in commodity markets, with copper down 2.6%, gold off 2.7%, and WTI crude declining 4.6%, reducing support for the commodity-linked currency.
• Investors are now turning their attention to Australia’s May employment report due on Thursday. Economists polled by Reuters expect employment to have increased by 30,000 jobs, while the unemployment rate is forecast to hold at 4.4%.
• Meanwhile, Reserve Bank of Australia Deputy Governor Andrew Hauser welcomed the recent decline in oil prices but stressed that inflation remains uncomfortably high, suggesting policymakers are unlikely to become complacent in their fight against price pressures.
• Immediate resistance is located at 1.6519(38.2%fib), any close above will push the pair towards 1.6565(Higher BB)
• Support is seen at 1.6443 (50%fib) and break below could take the pair towards 1.6362(61.8%fib).
Recommendation: Good to buy around 1.6450, with stop loss of 1.6400 and target price of 1.6550
