EUR/AUD has been cruising higher inside an ascending trend channel, and it looks like the latest bounce off the top could trigger a correction to support.
Here are the levels to watch on the 4-hour chart.
EUR/AUD 4-hour Forex Chart by TradingView
This pair popped sharply to test its ascending channel resistance early in the week, as traders reacted nervously to U.S. attacks on Iran over the weekend. However, improving risk sentiment allowed the channel top to hold, bringing EUR/AUD close to pullback levels.
The Fibonacci retracement tool shows where buyers could be waiting to sustain the uptrend. Are we about to see another leg higher soon?
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your homework on the Euro and the Australian dollar, then it’s time to check out the economic calendar and stay updated on daily fundamental news!
Price is closing in on the 38.2% Fib near the mid-channel area of interest and 1.7850 minor psychological mark while a larger correction could test the 50% Fib closer to the pivot point level (1.7900) or the 61.8% retracement near the channel support.
Be sure to look out for reversal candlesticks at any of these levels, as these could suggest that bulls are ready to hop back in and take EUR/AUD up to the channel top near the swing high and R1 (1.7950).
A strong return in upside momentum could even trigger a break past the channel top and a sharper climb to the next upside target at R2 (1.8040) so stay on your toes!
Whichever bias you end up trading, don’t forget to practice proper risk management and stay aware of top-tier catalysts that could influence overall market sentiment.
Disclaimer:
Please be aware that the technical analysis content provided herein is for informational and educational purposes only. It should not be construed as trading advice or a suggestion of any specific directional bias. Technical analysis is just one aspect of a comprehensive trading strategy. The technical setups discussed are intended to highlight potential areas of interest that other traders may be observing. Ultimately, all trading decisions, risk management strategies, and their resulting outcomes are the sole responsibility of each individual trader. Please trade responsibly.
