• EUR/AUD rose on Friday as euro clawed back some recent losses amid short-covering and firmer bund yields.
• Following the ECB's 25 basis point rate cut to 3% and the opening for additional reductions, euro saw a sharp downturn on Thursday.
• Germany's two-year bond yield, which is more sensitive to ECB rate expectations, rose by about two basis points to 2.03%.
• Rally towards is 1.6600 possible if EUR/AUD bulls overcome resistance at 23.6%fib
• Immediate resistance is located at 1.6537(23.6%fib), any close above will push the pair towards 1.6571(Higher BB).
• Strong support is seen at 1.6438(50%fib) and break below could take the pair towards 1.6357 (61.8%fib).
Recommendation: Good to buy around 1.6480 with stop loss of 1.6400 and target price of 1.6600
