AUD/USD looks offered, but unlikely to test 0.6170 – UOB

According to FX Strategists at UOB Group, AUD/USD remains under pressure although a move to 0.6170 is not on the radar for the time being.

Key Quotes

24-hour view: “We highlighted yesterday that ‘a break of 0.6300 would not be surprising but 0.6260 is likely out of reach’. The subsequent weakness in AUD exceeded our expectation as AUD dropped to 0.6254 before recovering. Downward momentum is showing sign of waning but there is scope for AUD to dip to 0.6245 first before a recovery can be expected. For today, the next support at 0.6210 is unlikely to come into the picture. Resistance is at 0.6315 followed 0.6340.”

Next 1-3 weeks: “We have held the same view since last Thursday (16 Apr, spot at 0.6300) wherein ‘a short-term top is in place’ and that ‘the pullback in AUD could extend to 0.6170’. While AUD dropped to 0.6254 yesterday, downward momentum has not improved by all that much and 0.6170 may not come into the picture so soon. On the upside, only a breach of 0.6370 (‘strong resistance’ previously at 0.6400) would indicate the current downward pressure has eased.”