Key Points
- The Euro traded lower against the Aussie dollar recently, and looks set for more declines.
- There was a contracting breakout pattern formed on the hourly chart of the EURAUD pair, which was broken to open the doors for more losses.
- Today, the Australia trade balance report was released by the Australian Bureau of Statistics.
- The forecast was lined up for a trade deficit of -2,750M in July 2016, but it posted -2,410M.
EURAUD Technical Analysis
The Euro recently declined heavily against the Aussie dollar and also settled below the 21 hourly simple moving average. Moreover, the EURAUD pair also broke a contracting breakout pattern formed on the hourly chart.
Currently, the pair is attempting to correct higher, but may face sellers near the 21 hourly SMA.
On the downside, the next target for sellers could be around the 1.236 extension of the last wave from the 1.4589 low to 1.4704 high.
Australia Trade Balance
Today during the Asian session, the trade balance, which is the difference in the value of its imports and exports of Australian goods was released by the Australian Bureau of Statistics.
The forecast was lined up for a trade deficit of -2,750M in July 2016. However, the outcome was on the higher side, as the trade deficit came in at -2,410M. The report added that “In trend terms, the balance on goods and services was a deficit of $2,485m in July 2016, an increase of $62m (3%) on the deficit in June 2016. In seasonally adjusted terms, the balance on goods and services was a deficit of $2,410m in July 2016, a decrease of $840m (26%) on the deficit in June 2016”.
Overall, the Aussie dollar has hardly any reason to decline from the current levels, so the EURAUD pair may face sellers moving ahead.
