• EUR/AUD rally extended towards 1.6700 on Wednesday as Australian dollar continued its downward march following the RBA’s 25 basis point rate hike.
• Despite hawkish elements, the RBA presented a more dovish outlook, shifting from a tightening bias to a stance that is more reliant on incoming data.
• The pair currently is approaching support at 38.2% fib. A break above 1.7470 leevel would unmask 1.6750 level in the short term.
• Technical signals show RSI is bullish at 55 , daily momentum studies 9, 10 and 11 DMAs are trending upwards.
• Immediate resistance is located at 1.6720(38.2% fib), any close above will push the pair towards 1.6796 (23.6 % fib).
• Immediate support is seen at 1.6645 (14DMA) and break below could take the pair towards 1.6622(50% fib).
Recommendation: Good to buy on dips around 1.6680, with stop loss of 1.6560 and target price of 1.6760
