• The EUR/AUD slipped sharply lower on Friday as continued Australian Dollar outperformance euro amid expectations that the Reserve Bank of Australia (RBA) could adopt a hawkish stance.
• Markets ramped up hawkish bets on the RBA Thursday as October’s household spending jumped 1.3%, well above September’s 0.3% reading.
•The Reserve Bank of Australia meets for the final time this year next week, and a string of strong readings on inflation, growth, and household spending has eliminated any prospect of a cut to the 3.60% cash rate.
•Swaps imply the Reserve Bank of Australia will remain on hold until late next year, but are pricing in a 75% probability for a rate hike by the end of 2026
• Immediate resistance is located at 1.7628(Daily high), any close above will push the pair towards 1.7705 (38.2%fib).
• Support is seen at 1.7532(23.6%fib) and break below could take the pair towards 1.7459(June 10th low).
Recommendation: Good to sell around 1.7600 with stop loss of 1.7700 and target price of 1.7520
