EURAUD has been trending lower inside a falling channel on its 4-hour time frame and is currently finding resistance at the middle of the channel. The Fibonacci extension tool shows how low this forex pair could go.

The 38.2% level is near the 1.5300 major psychological support while the 50% level lines up with the swing low at 1.5234. Stronger selling pressure could take EURAUD down to the 61.8% extension at 1.5175 near the bottom of the channel or the 76.4% level near 1.5100. The full extension is at 1.4984.

The 100 SMA is below the 200 SMA to confirm that the selloff is more likely to gain traction from here. The 100 SMA is also holding as dynamic resistance on the latest pullback while the 200 SMA dynamic inflection point is closer to the channel top.

Stochastic is already on the move down to confirm that selling pressure is present. The oscillator has plenty of room to head lower before reflecting oversold conditions or exhaustion among sellers.

Similarly RSI is pointing lower to show that sellers have the upper hand and could keep the drop going until oversold conditions are met.

The euro could take cues from the flash CPI releases later today, as the region could report slower inflationary pressures. The headline reading is slated to dip from 9.2% to 9.0% while the core figure could fall from 5.2% to 5.1% for January.

Weaker than expected results could dampen ECB tightening hopes in the coming months, leading to bearish euro sentiment ahead of the central bank’s statement later this week.

Meanwhile, the Aussie is also under a bit of downside pressure owing to downbeat data from the Land Down Under released earlier this week. Private sector credit and retail sales both missed estimates, signaling that the RBA might consider pausing its tightening cycle sooner rather than later.