FxWirePro: EUR/AUD drops as Aussie surges on hot CPI data

• EUR/AUD slipped sharply lower on Wednesday  as Australian dollar rose following hotter than expected Australian CPI data

• Australian consumer prices rose faster than expected in October, a new report showed on Wednesday, signaling stronger inflation and reinforcing expectations that the current policy easing cycle may be over.

• Data from the Australian Bureau of Statistics showed Australia’s monthly consumer price index (CPI) rose 3.8% year-on-year in October, the highest in 10 months and above the median forecast of 3.6%.

• The trimmed mean measure of core inflation rose to 3.3% year-on-year in October, up from 3.2% in September, moving further away from the RBA’s target direction.

•  Immediate resistance is located at 1.7918(38.2%fib), any close above will push the pair towards 1.7974 (Higher BB).

•  Support is seen at 1.7777(SMA 20) and break below could take the pair towards 1.7739(50%fib).

Recommendation: Good to buy around 1.7780, with stop loss of 1.7700  and target price of 1.7860