• EUR/AUD strengthened on Wednesday as signs of cooling US inflation bolstered bets that the U.S. Federal Reserve may pause its policy tightening.
• ECB remains favored to hike rates by at least 75bp into year-end versus the Fed not fully priced to hike 25bp in May before roughly 50bp of cuts by December.
• EUR/AUD remains strongly bullish, only a break and daily close below 38.2%fib support will shift bias to the downside
• Technical are bullish, daily RSI is at 67, daily momentum studies 11and 14 DMAs are trending up.
• Immediate resistance is located at 1.6439(Daily high), any close above will push the pair towards 1.6505 (23.6%fib).
• Strong support is seen at 1.6391 (5DMA) and break below could take the pair towards 1.6296 (38.2%fib).
Recommendation: Good to buy around 1.6400, with stop loss of 1.6310 and target price of 1.6480
