EUR/AUD Price Analysis — November 5

The EUR/AUD traded on a bullish tone in the early European session on Thursday as both the Reserve Bank of Australia (RBA) and European Central Bank (ECB) strive towards a swift QE expansion.

The Aussie (AUD) remained weak against the euro largely as a result of the impact of the global recession on Australia’s open economy. However, the exceptional performance of Asia-Pacific compared to Europe’s on the handling and containment of the Coronavirus should help the AUD climb against the EUR towards the end of the year.

Meanwhile, the Eurozone reported a better-than-expected economic rebound yesterday after surging by 12.7%, thereby cutting the annual decline to -4.3%.

Australia, on the other hand, had a -5% GDP report in Q3. However, the country’s low Coronavirus infection numbers have helped it relax restrictive lockdown measures across the country, which should open the door to a strong Q4 report. Meanwhile, Europe recently announced stricter lockdown measures across the continent following the resurgence of the virus, which will likely impede growth in its Q4 numbers.

That said, the ECB is likely feeling the need to boost its Pandemic Emergency Purchase Programme (PEPP) from an already humongous €1.35 trillion in its meeting in December.

EUR/AUD Value Forecast — November 5

EUR/AUD Major Bias: Sideways

Supply Levels: 1.6400, 1.6515, and 1.6567

Demand Levels: 1.6330, 1.6200, and 1.6100

The EUR/AUD appears to have softened the bearish tone that had prevailed for several days. The bearish momentum caused the pair to dip significantly below the ascending channel. That said, we are likely to see this pair struggle to get back into the channel following a strong rejection around the 1.6330 support.

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