- EUR/AUD is probably reversing its trend and starting a new downtrend.
- After peaking on October 31, it formed a bearish candlestick reversal pattern that is currently developing.
EUR/AUD has started to fall after forming a bearish Shooting Star candlestick reversal pattern (red shaded rectangle on the chart below) when it peaked on October 31.
EUR/AUD Daily Chart
Furthermore, a bearish day followed the Shooting Star day and added confirmation.
Since then, EUR/AUD has continued to sell off and there is evidence that it is now in a short-term downtrend. Given the principle that “the trend is your friend”, the odds favor a continuation downwards.
The next target is at 1.6400 and the 200-day Simple Moving Average (SMA), followed by the group of main SMAs below around 1.6350.
The pair may have completed a three-wave “abc” Measured Movement pattern at the October 31 highs, adding further evidence that a bearish cycle is likely taking control.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
