The EUR/AUD chart is almost impossible to confuse with any other chart. Over the past 6 months, the flat trend has continued in the range of 1.5242-1.5855 AUD. In May the resistance line was repeatedly tested, but the trend reversal did not occur. Why do we have this situation? Both the ECB and the RBNZ follow a soft monetary policy without a perspective of change in the near future despite the improvement in the economic background. This was confirmed once again last week, when meetings of both central banks were held.
At the same time, the AUD should have had more chances with the rise in commodity prices, but disappointing reports on the Chinese economy are holding back the strengthening of the AUD. In particular, in China unemployment increased in May and the volume of retail sales did not meet the forecasts. We will find out the unemployment data in Australia tomorrow. Next week we are going to be interested in reports on business activity in Germany and France.
So at the moment, we suppose that the low volatility will continue for the EUR/AUD pair. the rates will continue in a flat range, near the resistance line, as the AUD will not be able to find incentives to strengthen against the EUR. Most technical analysis tools indicate the effectiveness of the deals to SELL and we consider such deals to be the most optimal at the moment. The entry points can also be at the levels of 1.5242 and 1.5855.
