Australian Dollar: Oversold conditions limit losses against US Dollar – UOB

FXStreet Insights Team FXStreet

United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann note that AUD/USD outperformed on Monday, closing near 0.6970 after a modest rebound. Intraday, they see scope for slight gains but expect the pair to stay capped below 0.6985. Over 1–3 weeks, they judge that downward momentum is slowing and a break above 0.6985 would signal that the previously eyed 0.6866 support is unlikely to be reached, though medium‑term risks remain skewed lower.

Australian Dollar rebound but risks linger

"24-HOUR VIEW: Yesterday, we expected AUD to “trade sideways between 0.6930 and 0.6975.” AUD then traded within a slightly narrower range of 0.6933/0.6974, closing 0.30% higher at 0.6972. The tentative increase in upward momentum is not sufficient to signal a sustained advance. Today, AUD is likely to edge higher, but it is likely to stay within a 0.6945/0.6985 range. In other words, AUD is unlikely to break clearly above 0.6985."

"1-3 WEEKS VIEW: In our most recent narrative from last Friday (02 Oct, spot at 0.6930), we highlighted that “while the weakness that started in the middle of last month remains intact, given the deeply oversold conditions, any further decline may fall short of the next major support at 0.6866.” Downward momentum is starting to slow, and a break above 0.6985 (no change in ‘strong resistance’ level) would indicate that 0.6866 is out of reach."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.