• EUR/AUD rally extended towards 1.6900 on Tuesday after data showed German investor morale brightened unexpectedly in August
• ZEW's economic sentiment index rose to -12.3 points from -14.7 points in July. Analysts polled had expected sentiment to stagnate in August with a reading of -14.7.
• From a technical viewpoint, RSI is strongly bullish at 65, daily momentum studies, 5, 10 and 21 daily MAs all climb.
• Immediate resistance is located at 1.6936(Daily high), any close above will push the pair towards 1.6990(38.2% fib).
• Immediate support is seen at 1.6856(5DMA) and break below could take the pair towards 1.6734(5DMA).
Recommendation: Good to buy on dips around 1.6880, with stop loss of 1.6730, and target price of 1.6950.
