In view of FX Strategists at UOB Group, the Aussie Dollar could drop to the 0.7330/0.7300 band vs. the greenback in the next weeks.
Key Quotes
24-hour view: “AUD hit a fresh 2018 low of 0.7347 before rebounding quickly. The combination of oversold condition and waning momentum suggests low risk of a break below 0.7345/50. While a retest of this level is not ruled out, any weakness is not expected to be sustained. On the upside, resistance is at 0.7415 followed by 0.7435”.
Next 1-3 weeks: “The ease of which the previous year-to-date low of 0.7413 was taken out yesterday came as a surprise (note that this is the first update since 14 Jun). While the outlook has shifted to bearish, the decline that started late last week is already reaching oversold and we are likely ‘late in the game’. While further AUD weakness is not ruled out, any decline is likely limited to 0.7330, with lower odds for further extension to 0.7300. On the upside, only a break back above 0.7490 would indicate that a short-term low is in place”.
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