FxWirePro: EUR/AUD finds major trendline support at 1.5875, break below to see further weakness

• EUR/AUD has retraced dip below major support at 1.5875 (nearly converged trendline and 55-EMA), we see further weakness only on break below.
   
• The pair has broken below 20-DMA, bearish divergence keeps scope for further downside.
   
• Advanced inflation figures in Euroland came in below estimates earlier today weighing on the euro.
   
• Focus now on Markit PMI and retail sales data for further impetus.
   
• We see bearish divergence on RSI and Stochs which adds to the bearish bias.
   
• Technical indicators are biased lower, RSI below 50, bias lower. Stochs are biased lower and we see -ve DMI dominance.
   
• Next major support on the downside lies at 100-DMA at 1.5691. Violation there could see further weakness.

Support levels - 1.5775 (Apr 13 low), 1.5691 (100-DMA), 1.5586 (50% Fib)

Resistance levels - 1.5968 (20-DMA), 1.61, 1.6140 (Apr 25 high)

Call update: Our previous call (https://www.econotimes.com/FxWirePro-EUR-AUD-breaks-below-20-DMA-bearish-divergence-keeps-scope-for-further-downside-1290359) is progressing well.

Recommendation: Bias lower, stay short.

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