• EUR/AUD rose above 1.7000 level on Wednesday as investors flocked to the euro amid optimism over the German spending proposal.
• Germany proposed €500 billion infrastructure fund boosted Europe’s growth outlook amid trade tensions.
• The U-turn in Berlin late on Tuesday marks a potential sea change in economic policy after decades during which Germany’s neighbours have criticised it for holding regional growth back with excessive budgetary thrift.
• Technical signals show the pair could gain more ground in the short-term as RSI is at 77,while moving averages are trending higher.
• Immediate resistance is located at 1.7110(23.6%fib), any close above will push the pair towards 1.7167(Higher BB).
• Immediate support is seen at 1.6928 (38.2% fib) and break below could take the pair towards 1.6776 (50% fib).
Recommendation: Good to buy on dips around 1.7000, with stop loss of 1.6920 and target price of 1.7080
