• EUR/AUD fell below1.6300 level on Thursday after inflation data from Germany and Spain fuelled increased speculation that the European Central Bank may initiate an interest rate easing cycle.
• Inflation decreased in six key German states in August, indicating that national inflation could see a significant decline this month. Meanwhile, inflation in Spain slowed to its lowest pace in a year.
• At GMT 17:19, the pair was trading down 0.61 percent at 1.6282.
•Technical signals are bearish as RSI has turned sharply lower, daily momentum studies 5, 9 and 1 DMAs are trending down.
• Immediate resistance is located at 1.6421 (50%fib), any close above will push the pair towards 1.6477(Aug 27th high)
• Support is seen at 1.6278(38.2 %fib ) and break below could take the pair towards 1.6200(Psychological level).
Recommendation: Good to sell around 1.6300 , with stop loss of 1.6360 and target price of 1.6220.
