• EUR/AUD strengthened on Tuesday as Australian dollar weakened after the Reserve Bank of Australia stuck with plans to taper but extended the timeline.
• The Reserve Bank of Australia (RBA) concluded its September Board meeting by keeping interest rates at a record low of 0.1% as widely expected.
• The pair is currently approaching resistance at 1.6047 ( 38.2%fib). Resistance at 1.6047 is likely to cap further upside in the pair.
• Technical signals are bearish as RSI is at 47, daily momentum studies 11, 14 and 21 DMAs are trending down.
• Immediate resistance is located at 1.6047 ( 38.2%fib), any close above will push the pair towards 1.6147 (50 % fib)
• Strong support is seen at 1.5991 (5 DMA ) and break below could take the pair towards 1.5920 (23.6% fib).
Recommendation: Good to sell on rally around 1.6040, with stop loss of 1.6150 and target price of 1.5920.
