Turning Bullish: The EUR/AUD was trading in a choppy sideways market for most of November. However, at the end of the month and at the beginning of December, the pair is starting to develop a bullish outlook for the short and medium-term, as can be seen in the 4H chart. On top of that, when we take a look at the Daily and Weekly charts, we also see a bullish outlook developing in a long-term context.
Bullish Breakout: In the 4H chart, we can see that price has broken above 1.46 and is now starting to stay above it. The moving averages are starting to slope up and get into bullish alignment. The RSI has tagged 70 and so far held above 40, even 50, showing maintenance of the bullish momentum seen at the end of the November.
Now, if we get a significant pullback, the bullish outlook will still remain if price can hold above 1.4450. A break below this area will likely invalidate the late-November bullish signal.
Bullish Development: When we look at the daily chart, we are also seeing a bullish outlook developing .The market appears to have been bearish before September. But after a sharp rebound off the 2014-low, 1.3788, EUR/AUD consolidated between 1.42-43 support and 1.46-47 resistance. It looks like price is now breaking above this range, and clearing above the 200-, 100-, and 50-day SMAs as well.
Bullish Continuation in the Long-term: Now, as we move to the weekly chart, we can see that price has been bullish since mid-2012. In 2014 however, EUR/AUD was trading down a falling channel. That channel was broken in October, but as we saw in the daily chart, the pair was trading in a sideways range during this breakout. The thing is, we are price break above this range. In the weekly chart, we can see the strong bullish candle last week, and if it extends this week, price will be above all 3, 200-, 100-, and 50-week SMAs.
In the bullish continuation scenario for the long-term, the first challenge will be the support/resistance and psychological pivot at 1.50.
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