Will the market continue to lack direction following the recent decline? Should we take a wait-and-see approach to the EUR/AUD pair?

Will the market continue to lack direction following the recent decline? Should we take a wait-and-see approach to the EUR/AUD pair?

27.08.2025

In U.S. currency trading the previous day, the Canadian dollar fell against the yen. The CAD/JPY pair dropped from 106.739 to 106.192, declining as it encountered resistance at the 200-period EMA on the hourly chart.On the 4-hour chart, the 75-period moving average is acting as an upper resistance zone, with price action fluctuating as the market seeks direction while crossing the 20-period moving average. On the daily chart, the price has fallen to the -2σ Bollinger Band level near an RSI of 40. Note that during today’s Asian trading session, the Canadian dollar has shown a slight rebound, so caution is advised regarding the direction of the market.

Among European currencies, the euro saw a back-and-forth movement against the Australian dollar. The EUR/AUD pair traded between 1.7912 and 1.7981, with price action fluctuating around the 20-period moving average (MA) on the hourly chart.On the 4-hour chart, the decline continues as the 10-period MA caps the upside, with prices falling to just below the 200-period SMA. Meanwhile, on the daily chart, a small pause following three consecutive days of declines has resulted in a bullish candle with an upper shadow.

Today’s economic indicators include the Australian Westpac Leading Index at 9:30, the Australian Consumer Price Index at 10:30, remarks by U.S. Richmond Fed President Barkin at 13:01, the German GfK Consumer Confidence Survey at 15:00, and the UK’sCBI Retail Trade Survey at 15:00, the U.S. MBA Mortgage Applications Index at 20:00, U.S. weekly crude oil inventories at 23:30, and a U.S. 5-year Treasury auction at 26:00. I’d like to closely monitor the direction of the EUR/AUD pair to see if the market will continue to lack direction following the recent decline.