EURAUD – On the daily time frame this pair may have found a medium term bottom at the 1.36223 level. You can see that the pair have been in a downtrend pennant since early 2016. We are in a clear downtrend for this pair over the longer term and we are not out of that yet.
However, the most recent price action have shown us that this pair might be ready for some retracement back up.
It touched a low that was mentioned above and has gone back into the pennant after breaching it and going lower.
In fact we have an inverse head and shoulders pattern with the left should having been formed on the 16th Feb 2017 and the right shoulder very recently on the 2nd March 2017.
I believe that this pair is heading higher from here.
First upside target is resistance at 1.40746 and the next upside will be tougher resistance as it coincides with the slanting resistance line of the pennant at around the 1.42904 zone.
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