FxWirePro: EUR/AUD trends higher, but faces potential pitfalls

• The EUR/AUD gained some ground on Wednesday investors positioned themselves ahead of next week’s European Central Bank rate decision.

• The ECB  is expected to keep interest rates unchanged  , with eurozone inflation roughly in line with the central bank’s 2% medium-term target.

•Markets, having priced in the ECB’s moves, await Lagarde’s press briefing for clues on the bank’s policy path next year.

• German business morale unexpectedly fell in December, a survey showed on Wednesday, as Europe's largest economy continues to struggle to growth.

The Ifo institute said its business climate index fell to 87.6 this month from a slightly downwardly revised 88.0 in November. Analysts polled by Reuters had forecast a slight increase to 88.2.

•  Immediate resistance is located at 1.7800(Psychological level), any close above will push the pair towards 1.7914(Higher BB).

•  Support is seen at 1.7685(38.2%fib) and break below could take the pair towards 1.7483(Lower BB).

Recommendation: Good to buy around 1.7770 with stop loss of 1.7700 and target price of 1.7860