EUR/AUD Likely to Resume Downtrend if German Ifo Business Climate Slides

Eurozone – German Ifo Business Climate Index

Tuesday, at GMT 9:00 a.m., the Ifo Institute for Economic Research will publish this month’s German Business Climate index. The Ifo Business Climate figure measures the level of a composite index. It is created by surveying around 7,000 businesses in Germany by asking them to rate the comparative business conditions of now and in six months.

Since the survey has a large sample size compared to similar studies, binary options traders consider the Ifo Business Climate to be a strong leading indicator of the overall economic optimism in the country.

Last month, the German Ifo Business Climate index came out at 102.0. This month, analysts are expecting it to go down slightly and come out at 101.8.

Australia – Unemployment Rate

On Thursday, at GMT 12:30 a.m., the Australian Bureau of Statistics will release the national unemployment rate. It measures the percentage of total work force which remained unemployed over the past month.

Binary options investors consider the unemployment rate to be one of the most important fundamental indicators of the Australian economy. It is because one of the main goals of the Reserve Bank of Australia is to keep the unemployment as low as possible. Although this is a lagging indicator, analyzing this data can help Forex traders predict future interest rates and inflation situation in the country.

Last month, the unemployment rate in Australia came out at 5.0%. This month, analysts are expecting it to remain the same and come out at 5.0%.

EUR/AUD Forecast

Since breaking below the uptrend line on October 31, the EUR/AUD remained in a steady downtrend. However, over the last few weeks, the pair moved up sharply. Last week, it found a strong resistance near the 1.5870 level. Consequently, it tested the support near the 61.8% Fibonacci level of the last upswing, at 1.5685.

The Australian unemployment rate will likely not change last month and remain at 5.0%. On the other hand, analysts are expecting the German Ifo Business Climate to come down slightly to 101.8. We believe it would set a bearish fundamental outlook for the EUR/AUD this week. Therefore, if the EUR/AUD closes below the support near 1.5685, it would likely attract additional bearish momentum in the market.

Hence, Australian binary options traders should look out for trading opportunities below this major support level around 1.5685.

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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