• EUR/AUD pair initially firmed but gave up ground as investors focus shifted to the US President-elect Donald Trump’s inauguration ceremony.
• ECB policymaker Joachim Nagel urged caution against rushing interest rate cuts, citing elevated inflation and significant economic uncertainty. His remarks highlight the ECB's measured approach amid ongoing challenges.
• The ECB has cut interest rates four times since June and is expected to continue doing so in the next six months, having seen inflation fall from double digits in late 2022 to just above its 2% target..
• Immediate resistance is located at 1.6621 (38.2% fib), any close above will push the pair towards 1.6766 (23.6% fib).
• Strong support is seen at 1.6498(50 fib) and break below could take the pair towards 1.6376(61.8% fib )
Recommendation: Good to buy around 1.6550 with stop loss of 1.6450 and target price of 1.6720
