The Australian dollar gained a boost on a speech given by the Reserve Bank of Australia (RBA) Governor Philip Lowe at the Committee for the Economic Development of Australia in Adelaide. RBA accepted that an additional interest rate cut was ‘not unrealistic’ and admitting that low-interest rates can help increase pricing power. However, monetary policy was not the only option. However, the current rate cut would not be sufficient to promote economic growth. Lowe has also called for the government to take action where traditionally the RBA avoids talking on fiscal policy.
EUR/AUD – Symmetrical Triangle Breakout
Have a glance at the chart of EUR/AUD. There’s a bearish divergence within the price and the Awesome Oscillator on the daily timeframe. The pair has formed a symmetric triangle which was providing a substantial hurdle to EUR/AUD at 1.6340. For now, EUR/AUD seems to violate this hurdle to test the double top level of 1.6360.
The pair tested levels above the 50% Fibo of the 2008-2012 decline but then returned lower. Besides, yesterday the pair formed a pin bar (a candlestick with a long upper wick) around 1.6300 support, suggesting oppressive buying intentions of investors. The violation 1.6360 can push the Aussie cross towards 1.6380. On the lower side, 2 hours closing below the double top 1.6350 can trigger selling in the pair.
Support and Resistance
Key Trading Level: 1.6326