• EUR/AUD initially dipped on Monday but recovered some ground as investors were cautious ahead of a Reserve Bank of Australia speech and NAB business conditions on Tuesday.
• EUR/AUD fails to break support at 1.5989 (38.2%fib) and recovers towards 1.6044 .
• The current mild downward pressure is deemed intact as long as the pair does not move above 50% fib resistence.
• Technical signals are bearish as RSI is at 47, momentum studies, 5, 10 & 21 DMAs in bearish alignment.
• Immediate resistance is located at 1.6038 ( 11 DMA), any close above will push the pair towards 1.6089 (50% fib)
• Strong support is seen at 1.5989 (38.2%fib)and break below could take the pair towards 1.5911 (Sep 11th low).
Recommendation: Good to sell around 1.6040, with stop loss of 1.6120 and target price of 1.5960.
