EUR / AUD defended 1.6597 key support again last week and recovered. However, the head is limited well below 1,7194 resistance. The initial bias remains neutral this week first. On the upside, breaches of 1,7194 resistance must confirm short-lived bottoms. A stronger increase should then be seen to the 38.2% retracement from 1.9799 to 1.6538 at 1.7784 next. However, a break of 1.6538 would indicate a resumption of the down from 1.9799 on the downside. More importantly, sustained trading below 1.6597 key support will bring greater bearish implication and target 1.5962 support next.
In the bigger picture, focus remains on 1.6597 key cluster support (2015 high and 38.2% retracement of 1.1602 to 1.9799 at 1.6668, 55 week EMA (now at 1.6544). Strong rebound from current level will maintain transparency bullish) Larger trend from 1.1602 (low in 2012) would extend through a maximum of 1.9799. However, sustained break of 1.6597 suggests bearish reversal and target of 61.8% retracement of 1.4733.
In the longer-term picture, the increase from 1.1602 long-term bottom (2012 low) is still ongoing, with 2.1127 (high 2008) as the next target. A sustained break of 1.6597 (high 2015) cluster support with the 38.2% retracement from 1.1602 to 1.9799 at 1.6668 would argue that such a rally has ended. Outlook then turns bearish for the 61.8% retracement of 1.4733.