- 1 EUR/AUD – Technical Analysis for Forex Trading & CFDs.
EUR/AUD – Technical Analysis for Forex Trading & CFDs.
Australia – Building Approvals
On Tuesday, at GMT 2:30 a.m., the Australian Bureau of Statistics will release the national month-over-month building approvals figure, which measures the changes in the number of approvals of new buildings.
Since a build permit indicates new construction work, it suggests that there would be additional positive economic activities. For example, new jobs would be created for construction workers. Therefore, Forex investors consider this data regarding new building approvals to be a leading indicator of the overall economic health of the country.
Last month, the building approvals figure decreased by -13.4% and the forecast for this month is currently set at an increase of 3.2%.
Eurozone – German Preliminary Consumer Price Index (CPI)
Later tomorrow, the Destatis will release the month-over-month German Preliminary CPI, which measures the change in the price of goods and services bought by German consumers over the past month.
Since the German central bank primarily uses the CPI to measure inflation, it has profound impact on the German economy. Moreover, as the German economy makes up a large portion of the overall Eurozone economic activity, the German CPI also influences the valuation of the Euro against other major currencies. Hence, Forex traders consider the German Preliminary CPI to be a leading indicator of the Euro.
Last month, the last German preliminary CPI (m/m) indicated that there was a 0.0% change in price and the forecast for this month is that there was a -0.1% decrease in the price level during the past month.
Since breaking above the resistance near 1.4310 level on April 23, the EUR/AUD has climbed up by around 800 pips. Last week, the pair found resistance near the 1.5070 level and remained mostly range bound. So far, the EUR/AUD has failed to penetrate below the support level around 1.4930 level.
As the Australian building approvals figure is expected to improve by 3.2%, but the German preliminary inflation is expected to decline by -0.1%, we believe it would likely set a bearish fundamental outlook for the EUR/USD this week. Therefore, if the EUR/USD penetrates and closes below the last week’s support level around 1.4930, it would likely attract additional bearish momentum in the market.
Hence, Australian Forex traders should look out for trading opportunities below this major support level around the 1.4930 level.
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