Key Points
- The Euro’s every attempt to trade higher against the Aussie dollar failed, and it looks poised for more losses.
- There is a bearish trend line formed on the hourly chart of the EURAUD pair, which is acting as a barrier for the upside move.
- The German Industrial Production released by the Statistisches Bundesamt Deutschland posted a decline of 0.4% in May 2016, not what the market expected.
- In terms of the yearly change, there was a decrease of 1.3% in May 2016, compared with the forecast of 0%.
Technical Analysis
The Euro traded down against the Aussie dollar and tested the 1.4700 support area. The EURAUD pair is currently recovering from the lows, but it may face sellers around a bearish trend line formed on the hourly chart.
The trend line resistance acted as a resistance earlier, and may continue to stall the gains.
The 100 hourly simple moving is also aligned with the trend line resistance, which increases its importance in terms of a resistance.
German Industrial Production
Earlier today, the German Industrial Production, which measures outputs of the German factories and mines and an important indicator of strength in the manufacturing sector was released by the Statistisches Bundesamt Deutschland. The market was not expecting no change in the production in May 2016, compared with May 2015.
However, the outcome was negative, as there was a decline of 1.3%. The report added that “In May 2016, production in industry excluding energy and construction was down by 1.8%. Within industry, the production of capital goods decreased by 3.9% and the production of intermediate goods by 0.3%.”
Overall, the EURAUD pair remains in a downtrend, and it looks like there are chances of more losses in the near term.
