FxWirePro: EUR/AUD dips below lower range, bearish bias increases

• EUR/AUD dipped  on Wednesday  as Australian dollar firmed on  growing market bets that the RBA will maintain a tighter monetary policy outlook..

• RBA Deputy Governor Andrew Hauser said inflation remains elevated and the economy is operating near capacity, reinforcing expectations that further policy tightening may be needed.

• The RBA raised its cash rate to 3.85% last week, and markets are now pricing in about a 70% chance of another increase to 4.10% in May, contingent on upcoming first-quarter inflation data.

• Adding to the case for a rate hike, data on Wednesday showed mortgage lending rose 9.5% in the fourth quarter, while investment loans climbed to a record high.

• Technical signals are bearish as RSI is at 26, momentum studies  11,14  and 21 DMAs are trending down. 

• Strong  resistance is located at 1.6868(38.2%fib), any close above will push the pair towards 1.7027 (SMA 20)

• Immediate support is seen at 1.6638 (23.6% fib) and break below could take the pair towards 1.6594 (Lower BB).

  Recommendation: Good to sell   around 1.6700, with stop loss of 1.6800 and target price of 1.6630