EURAUD took advantage from the weakness of U.S dollar for the FED speech is awaited and traders are expecting Jerome Powell to downplay the dollar. Also Australian dollars weakness became another reason for EURO to gain strength and reach for highest highs in daily time frame. Investors are still eyeing on the covid headlines to anticipate reopening of activities in Europe and ease in restrictions to provide more supporting ground for Euro.  EURAUD has stepped into head and shoulder pattern in weekly time frame and has set some indications for an awaited correction in shape of fall.

We have some strong resistance here i.e 1.61200 and is trading near neutral sentiment zone of supply and demand, yet weak in momentum to provide any further bullish stance before facing a bearish corrective reversal. This zone has also been a range bound or extensive complex corrective structure with our 50%fibb level hanging on top to become another reason for Euro to go down. 

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

According to our elliot wave analysis, EURAUD has completed its impulsive 5 wave bullish structure of higher degree under intraday and weekly time frame, yet we dont have a closing or a proper stop to the hawkish move for the pair is still in its highest zone - not indicating any signs of taking a pause here. So we will have to wait for its closing and look for hints as the market takes a reversal for correction. We have our 50% fibb retracement level on weekly chart which can also be taken as a sign of bearish reversal, keep in mind the correction will be made of a higher degree in daily time frame to step out of overbought conditions with RSI trading near 70. So wait as the market makes a bearish corrective wave 'a', will be our first fractal confirmation for executing our selling entries.

EURAUD D1

Jul 28 2021