• EUR/AUD strengthened on Wednesday as risk-sensitive Australian dollar was negatively impacted by below-forecast Aussie CPI data.
• According to data released by the Australian Bureau of Statistics on Wednesday, the monthly Consumer Price Index (CPI) in Australia recorded an annual increase of 3.4% in January, maintaining the same level as December.
• A close above 23.8% fib resistance will likely trigger a new bullish phase with potential for 1.6750 level.
• From a technical viewpoint, RSI is strongly bullish at 64, daily momentum studies, 5, 9 and 11 are trending up.
• Immediate resistance is located at 1.6687(23.6%fib), any close above will push the pair towards 1.6767(21st Nov 2023 high).
• Immediate support is seen at 1.6589 (38.2% fib) and break below could take the pair towards 1.6505(50%fib).
Recommendation: Good to buy on dips around 1.6680, with stop loss of 1.6600, and target price of 1.6750
