EURAUD has formed a lower swing high at the 1.8155 level, followed by a relatively strong sell-off through the trendline support drawn from the November 2024 lows. This price action suggests that the pair has entered the third leg lower, which is expected to unfold in a five-wave structure from the October high.
As such, further downside is anticipated within wave (3) during the first half of 2026, particularly after the decisive break below the base channel support. At the moment, price may be undergoing a corrective pullback in subwave 4, before a bearish continuation into subwave 5 of (3). Ideal resistance is at the projected 1.66 – 1.68 area.
As long as the market remains below the 1.7484 invalidation level, the broader outlook favors continued weakness over the coming weeks to months.
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