Key Points
- The Euro after a continuous struggle around the 1.4780 against the Aussie dollar failed and traded lower.
- There was a crucial bullish trend line formed on the hourly chart of the EURAUD pair, which was broken during the downside move.
- The German business sentiment index released by the CESifo Group posted a decline from 108.7 to 108.3 in July 2016.
- The German IFO Current Assessment on the other hand, posted a rise from 114.6 to 114.7 in July 2016.
Technical Analysis
The Euro enjoyed solid gains against the Aussie dollar until it found resistance near 1.4780. The EURAUD pair started to trade down, and also broke a crucial bullish trend line formed on the hourly chart.
The pair also settled below the 21 hourly simple moving average, which is bearish sign calling for more losses in EURAUD in the short term.
If the pair corrects higher from the current levels, then it can find sellers near the broken trend line and the 21 hourly SMA. So, one may consider selling with a stop above the 21 hourly SMA.
German IFO Business Climate Index
Today, the German business sentiment index was reported by the CESifo Group. It is an important index, and one of the closely watched indicators of current conditions and business expectations in Germany. It was forecasted to post a decrease of more than 1 point. However, the result was not that bad, as the decline was limited. The German business sentiment index declined from 108.7 to 108.3 in July 2016.
Moreover, the German IFO Current Assessment was even better, as there was a rise from 114.6 to 114.7 in July 2016.
In short, the result was above the forecast, but it failed to help the Euro in the near term.
