EUR/AUD Likely Turn Bearish if German ZEW Economic Sentiment Capitulates
Last Updated on July 5, 2021
EUR/AUD Forecast – 5th July 2021
Australia – Cash Rate
On Tuesday, at GMT 4:30 a.m., the Reserve Bank of Australia (RBA) will release the official cash rate. It is the interest rate that major Australian banks and financial institutions pay to borrow funds held at the RBA.
Short-term interest rates are the primary factor in the valuation of the Australian Dollar against other major currencies. So, top Forex brokers in Australia pay close attention to any changes in the official cash rate.
The RBA left the cash rate at 0.10% in their last meeting. The forecast for this month is that the RBA will leave it unchanged at 0.10%.
Eurozone – German ZEW Economic Sentiment
On Tuesday, at GMT 9:00 a.m., the Zentrum fur Europaische Wirtschaftsforschung (ZEW) will release its German economic sentiment index. It measures the level of a diffusion index based on surveying 275 German institutional investors and market analysts.
Since the professional investment community, investors, and analysts have the latest data; their reflection about the economy tends to be the most accurate. Therefore, CFD traders consider the ZEW’s German economic sentiment index to be a leading indicator of the entire Eurozone economy. This is because the German economy is one of the most important driving forces behind the Euro currency.
Last month, the ZEW German economic sentiment came out at 79.8. This month, analysts are expecting it to come down to 75.0.
Since the end of February, the EUR/AUD remained bullish. Over the last few months, it climbed up by around 615 pips and found resistance near the 200 periods moving average. Yesterday, it once again tested the resistance near 1.5870 but fell sharply. Currently, it is trading just below the resistance around 1.5825 about to test the support near 1.5685.
The Australian overnight cash rate will likely remain at 0.10%. However, the German ZEW Economic Sentiment for the Eurozone will likely come down to 75.0. We believe it would set a bearish fundamental outlook for the EUR/AUD this week. Therefore, if the EUR/AUD closes below the support near 1.5685, it would likely attract additional bearish momentum in the market.
Hence, CFD traders should look out for trading opportunities below this major support level near 1.5685.
- GBP/USD Likely to Resume Downtrend Amid Forecast of Lower Unemployment Rate in the US - January 4, 2022
- USD/CHF Likely to Remain Bullish Amid Forecast of Improving Durable Goods Orders in the US - December 20, 2021
- USD/JPY Bullish Momentum Likely to Continue Amid Forecast of Increasing Inflation in the US - December 7, 2021
EURUSD falls before the results of the European Central Bank meeting
EURUSD witnessed a decline in the morning of Thursday's trading in the European market after…
EURUSD moves away from three-week highs after US inflation data
EURUSD fell on Friday morning in the European market, and recorded its first daily loss,…
EURUSD continues to climb to the highest level in three weeks
EURUSD continued to achieve gains on Friday morning in the European market, and recorded the…
GBPUSD continues to decline for the second day after negative data
GBPUSD continued to decline in the morning trading on Friday, and recorded the second consecutive…
EURUSD continues to rise, hitting its highest level in two months
EURUSD continues to perform positively on Friday morning in the European market to reach its…
GBP/USD Likely to Resume Downtrend Amid Forecast of Lower Unemployment Rate in the US
United Kingdom - Net Lending to Individuals On Tuesday, at GMT 9:30 a.m., the Bank…