EUR/AUD capped below 5-DMA, shooting star formation and bearish divergence raise scope for downside.
The pair has formed a 'Shooting Star' pattern at highs on May 5th trade and bearish following candle confirms downside.
Stochs have rolled over from overbought levels and are showing bearish divergence to price action.
RSI has also rolled over from overbought levels adding downside bias.
We see scope for test of 1.46 (23.6% Fib retrace of 1.3626 to 1.4910 rally).
Bearish invalidation only on close above 5-DMA at 1.4758.
Support levels - 1.4653 (May 4 low), 1.46 (23.6% Fib), 1.4529 (20-DMA)
Resistance levels - 1.4759 (5-DMA), 1.48, 1.4910 (May 5 high)
Good to go short on rallies around 1.47, SL: 1.4750, TP: 1.4650/ 1.46/ 1.4550
The pair has formed a 'Shooting Star' pattern at highs on May 5th trade and bearish following candle confirms downside.
Stochs have rolled over from overbought levels and are showing bearish divergence to price action.
RSI has also rolled over from overbought levels adding downside bias.
We see scope for test of 1.46 (23.6% Fib retrace of 1.3626 to 1.4910 rally).
Bearish invalidation only on close above 5-DMA at 1.4758.
Support levels - 1.4653 (May 4 low), 1.46 (23.6% Fib), 1.4529 (20-DMA)
Resistance levels - 1.4759 (5-DMA), 1.48, 1.4910 (May 5 high)
Good to go short on rallies around 1.47, SL: 1.4750, TP: 1.4650/ 1.46/ 1.4550