AUD/USD: Expected to consolidate in a range of 0.6485/0.6525 – UOB Group
|Australian Dollar (AUD) is expected to consolidate in a range of 0.6485/0.6525. In the longer run, outlook for AUD is negative now, but last month’s low near 0.6445 may not come into view so soon, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Outlook for AUD is negative now
24-HOUR VIEW: "AUD fell sharply on Tuesday. Yesterday, Wednesday, when it was at 0.6485, we pointed out that 'strong momentum suggests AUD could drop further, potentially testing 0.6460'. However, we were of the view that 'the major support at 0.6445 is likely out of reach for now'. While we were not wrong, as AUD dropped to a low of 0.6459, we did not expect the strong rebound from the low, which touched a high of 0.6513. Downward momentum has faded with the strong rebound, and today, we expect AUD to consolidate, most likely in a range of 0.6485/0.6525."
1-3 WEEKS VIEW: "Yesterday (05 Nov, spot at 0.6485), we stated that “the outlook for AUD is negative now, but last month’s low near 0.6445 may not come into view so soon.” We added, “to keep the momentum going, AUD must hold below the ‘strong resistance’ level, now at 0.6540.” AUD subsequently dropped to 0.6459 before rebounding strongly. Downward momentum has slowed somewhat, but as long as 0.6540 (no change in ‘strong resistance’ level) is not breached, there remains a chance for AUD to decline to 0.6445."
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