EUR/AUD Price Analysis — December 17

The EUR/AUD traded on a bearish momentum in the European session on Thursday, as volatility across markets picks up.

Negotiations between the European Union and the UK over a Brexit trade deal appears to be making good progress. However, both sides remain adamant over the fishery sector, a sensitive issue for both parties. Nonetheless, the recent rally in the Pound is dragging the Euro along.

Meanwhile, COVID-19 cases across the continent continue to spread despite renewed lockdown measures and have infected French President Emmanuel Macron.

Yesterday, the EU reported better-than-expected Manufacturing PMI and Services PMI numbers, indicating decent economic recovery despite the effect the Coronavirus pandemic has had on the eurozone.

Later today, the EU will be publishing its inflation data for November. Analysts expect an upbeat report on the Inflation Rate (YoY) and the Core Inflation Rate.

In other news, strong commodity performance will continue to be a source of strength for the Aussie. Iron ore exports broke a new record high of A$11 billion in October and represented 36% of Australia’s total exports. The mining sector was partly responsible for the improved budget reported by the Australian federal government this week.

However, further easing measures and dovish monetary policy by the Reserve Bank of Australia in 2021 could place a lid on any significant rally in the Aussie.

EUR/AUD Value Forecast — December 17

EUR/AUD Major Bias: Bearish

Supply Levels: 1.6100, 1.6150, and 1.6200

Demand Levels: 1.6000, 1.5950, and 1.5900

The EUR/AUD suffered a sharp dip earlier today, after a seven-day consolidation period between 1.6140 – 1.6050. This pair has failed to reclaim the crucial 1.6100 level, making further declines likely in the meantime.

However, the EUR/AUD saw a goodish bounce off the 1.6000 psychological level a few hours ago. Failure to regain a footing above the 1.6100 price point in the coming hours could force this pair below 1.6000.

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