- EUR/AUD breaks below 20-DMA, scope for further weakness.
- Advanced inflation figures in Euroland came in below estimates earlier today weighing on the euro.
- We see bearish divergence on RSI and Stochs which adds to the bearish bias.
- Technical indicators are biased lower, RSI below 50, bias lower. Stochs are biased lower and we see -ve DMI dominance.
- Due later in the NY session focus will be on US ISM Non-manufacturing followed by Trade Balance, Initial Claims, Durable Goods Orders and Factory Orders.
- Next major support on the downside lies at 100-DMA at 1.5685. Violation there could see further weakness.
Support levels - 1.5775 (Apr 13 low), 1.5685 (100-DMA), 1.5586 (50% Fib)
Resistance levels - 1.5973 (20-DMA), 1.61, 1.6140 (Apr 25 high)
Recommendation: Good to go short on rallies around 1.5910/20, SL: 1.5975, TP: 1.58/ 1.5775/ 1.5685.
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