Analyzing the EUR/AUD H4 chart, we can see a long period of consolidation and low volatility since October. Both currencies were at the same level and did not find incentives to grow. In December the situation changed. The Australian dollar has come under unprecedented pressure amid alarming reports from China, where a new wave of covid is being recorded. This will undoubtedly have consequences for the entire world economy, but above all for the economy of China and the countries that are export dependent on China. Thus, after a period of consolidation, the uptrend resumed.
Against the backdrop of holidays both in the EU, and Australia, the rates were influenced solely by news from China. On Friday, the focus of investors will be manufacturing PMI index of business activity and the PMI composite index in December. Last month, the index was only 48 pips, which is a bad signal for the global economy, and no improvement expected due to problems with the pandemic. So the AUD will again come under pressure. The potential for further growth in the euro remains, as annual highs have not been reached. In January, there is a high probability that levels 1.6000 - 1.6150 will be tested.
Most technical analysis tools give us a Buy signal, and there is every reason to consider this a correct signal. The deals to BUY today could give us our first profit in early January, which will be a good start for next year. Therefore, today we open the deals to Buy.
