Will EUR/AUD hold gains as momentum buyers support the pair?

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Euro vs Australian Dollar up 0.51% today

Highlights

The Reserve Bank of Australia raised its main interest rate to 4.85%, the highest level since 2008.
The rate hike is prompting market participants to reassess EUR/AUD carry trade and capital flow strategies.
EUR/AUD trades with strong short-term bullish momentum, expected to range between A$1.599 and A$1.615 over the next 2 to 3 days.

RBA rate hike shifts capital flows and strengthens Australian dollar appeal

The Reserve Bank of Australia has raised its main interest rate to 4.85%, marking the highest level since 2008 and heightening the relative yield appeal of the Australian dollar, according to Fxmag. This policy action recalibrates the cross-currency dynamics with the euro, leading market participants to reassess carry and capital flow strategies. The adjustment in monetary policy serves as a fundamental backdrop for traders evaluating short-term positioning in EUR/AUD.

Bullish signals strengthen as strong momentum meets overbought risks

On the H1 chart, EUR/AUD trades above the MA-20 at A$1.6038 and MA-50 at A$1.5986, while remaining below the MA-200 at A$1.6317 on the daily timeframe. The Ichimoku Kijun sits at A$1.6022, acting as immediate support. Momentum signals are strong, with both MACD and ADX generating buy signals, and the Awesome Oscillator also supporting bullish momentum. Both RSI and Stoch RSI are in neutral regions, but CCI is now in the overbought zone, highlighting a potential for near-term correction risk. Bull/Bear Power is slightly positive at 0.0023, reflecting modest buyer dominance intraday.

Upside favored as narrow consolidation signals breakout potential

Over the next two to three days, the forecast projects a consolidation band between A$1.599 and A$1.615. The probability of an upward movement is assessed as very high, while the chance of a downward move is very low in the immediate term. The baseline scenario is for price action to hold within this corridor, with an upside breakout targeting levels above A$1.615 and a downside move requiring a sustained break below support at A$1.599.

Viktoras Karapetjanc, Traders Union expert, sees the recent RBA rate hike as a fundamental tailwind for the Australian dollar, but notes that EUR/AUD still shows strong technical momentum. He believes the market is recalibrating around these policy developments, with short-term positioning reflecting renewed risk appetite. The current setup suggests a consolidation phase with bias toward an upside resolution in the A$1.599–A$1.615 band. "With favorable macro factors and bullish sentiment in place, I expect EUR/AUD to maintain upward traction as long as support near A$1.599 holds."

Earlier, analysts noted that EUR/AUD was experiencing renewed but limited buying interest within a broadly cautious technical structure. The current article advances this view by highlighting a reinforced bullish bias amid stronger momentum signals, prompting traders to monitor for an upside breakout above A$1.615 as the next actionable scenario.

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.