Market update: Aussie outlook remains bearish against the dollar and the euro

In recent days, the Australian dollar has been aiming higher of late, with some mixed progress among major currency pairs. Looking at the daily chart below, AUD/USD has turned cautiously higher as positive RSI divergence persisted. The latter indicated that downside momentum was fading, hinting that a turn higher might have been in the cards.

Now, the exchange rate is sitting just under the 50-day moving average. In August, a bearish death cross emerged between the 20- and 50-period lines, offering a downward technical bias. As such, despite recent gains, the technical bias remains bearish. Besides the moving average, immediate resistance seems to be the 0.6459 inflection point.

The latter was established back in May. Breaking higher exposes the 0.6568 inflection point from the March low. Otherwise, turning lower places the focus on support which is the November low of 0.6272.

AUD/USD daily chart

EUR/AUD technical analysis

Switching to the Euro, EUR/AUD has been in a cautious downtrend since August. But, the exchange rate remains in an overall uptrend. The latter seems to be upheld by rising support from the beginning of this year – see chart below.

From here, immediate resistance appears to be the combination of the 23.6% Fibonacci retracement level of 1.6638 and the 50-day moving average slightly above that. Clearing these would open the door to potentially revisiting the July peak of 1.7065.

Otherwise, a turn lower places the focus on rising support from the beginning of this year, which may reinstate the broader uptrend. Breaking lower opens the door to offering an increasingly bearish technical bias.

EUR/AUD daily chart

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