This analysis is simply technical and could possibly go both ways. The pair has been on a steady incline this month gains of just over 500 pips. With reversal patterns formed on the H4 and H1 charts and an overbought stochastic on the Daily chart, I think we might see a change in market direction and I will be looking for selling opportunities from now on and a possibility of a carry trade.

EurAud Daily Chart

Price opened within a bull area zone at the beginning of the month. It then went on to break a key level of resistance at the monthly pivot at 1.3900 which it then retested later. It recently came off resistance at 1.4300. With flat Market action moving averages and an overbought stochastic, we might see it break down the immediate support at 1.4100 or form a lower high at it.

EurAud H4 Chart

Price formed a double top at a key level of resistance at 1.4300. It found support at 1.41500 after having broken down through the 21. A retest at the neckline is where I will be looking for selling opportunities.

EurAud H1 Chart

Price is within an area where bulls are most likely to buy. With the 21/55 having crossed to the downside signalling a bearish sentiment, I will be looking for selling opportunities within the fibzone. Keep in mind that some bears would possibly sell off the 21.

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