US Treasury expands bond buyback program: EUR/AUD technical outlook

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Euro vs Australian Dollar down 0.52% today

Highlights

The US Treasury doubled its long-dated bond buyback operations to at least $4 billion per auction from September 9 to November 4, boosting official demand and lowering long-term yields.
The US dollar index declined, increasing appeal for the euro and Australian dollar; later, mixed Australian PMI data influenced the relative strength of both currencies.
EUR/AUD trades below key moving averages with strong sell signals from multiple momentum indicators, projecting a high likelihood of further declines toward A$1.6251 to A$1.6415 in the next 2 to 3 days.

US bond buybacks and mixed data drive euro-aussie shifts

The US Treasury’s decision to double the size of its longer-dated bond buyback operations, raising maximums per operation from $2 billion to at least $4 billion between September 9 and November 4, increased official demand for US government debt and contributed to lower long-term yields, according to Nytimes. This action led to a noticeable decline in the US dollar index and made both the euro and Australian dollar more attractive to currency markets, as highlighted by Nytimes and Economictimes Indiatimes. Subsequently, however, a rebound in US bond yields and mixed Australian PMI data—which showed expansion but softening services momentum—affected relative shifts between the euro and Australian dollar, according to Fxstreet.

Bearish pressure intensifies as technical signals point lower

On the hourly chart, EUR/AUD remains below the MA-20 at A$1.639 and the MA-50 at A$1.6397, while on the daily chart, the price is well below the MA-200 at A$1.6526. The Ichimoku Kijun is positioned at A$1.639, providing immediate resistance. Momentum indicators confirm strong downside: MACD and ADX are both on Sell, while RSI, Stochastic RSI, and CCI indicate oversold readings, suggesting bearish momentum may be stretched. Bull/Bear Power highlights ongoing intraday seller dominance, and the Awesome Oscillator also supports the prevailing downward trend.

Rangebound trading expected as downside risk dominates

Over the next two to three trading days, EUR/AUD is expected to remain confined to a range between A$1.6251 and A$1.6415, reflecting a typical volatility band relative to current levels. The likelihood of a further decline remains very high within this period, and any upward movement above A$1.639 is considered improbable unless a decisive break occurs. The baseline scenario favors sideways consolidation within the established corridor, while a sustained move below A$1.6251 would open the door for additional downside.

Anton Kharitonov, analyst at Traders Union, sees continued pressure on EUR/AUD below its moving averages and technical barriers. He notes that macro drivers, like the US Treasury’s bond buyback expansion, briefly supported both EUR and AUD, but fading momentum in the Australian economy and seller dominance keep rebound chances low. Downside signals from major momentum indicators reinforce a defensive stance. "Until EUR/AUD decisively reclaims at least A$1.639, I remain cautious and expect further rangebound to lower price action."

Earlier, analysts noted that EUR/AUD was displaying persistent bullish momentum but remained constrained by longer-term resistance, suggesting ongoing consolidation. The current setup signals a reversal of that pattern, with downside momentum now dominant and a sustained move below A$1.6251 presenting the next substantial risk for traders to monitor.

Source of Data: EUR Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.