AUD/USD: Major support at 0.6330 is unlikely to come under threat – UOB Group

Slight increase in momentum suggests Australian Dollar (AUD) could test 0.6350 against US Dollar (USD); the major support at 0.6330 is unlikely to come under threat. In the longer run, AUD must break and hold below 0.6370 before a move to 0.6330 can be expected, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

AUD must break below 0.6370 to move towards 0.6330

24-HOUR VIEW: "Yesterday, AUD traded between 0.6358 and 0.6461, closing on a soft note at 0.6372. There has been a slight increase in downward momentum. Today, we expect AUD to test the support at 0.6350. The major support at 0.6330 is unlikely to come under threat. Resistance is at 0.6400, followed by 0.6420."

1-3 WEEKS VIEW: "We noted a slight increase in downward momentum last Friday (09 May), when AUD was at 0.6400. We indicated that 'the increase in momentum is not enough to suggests a sustained decline just yet, and AUD must break and hold below 0.6370 before a move to 0.6330 can be expected.' Yesterday, Monday, AUD fell to 0.6358 but closed above 0.6370 at 0.6372, down by 0.62%. The increase in momentum is still not enough to suggest a sustained decline. In other words, our view remains unchanged. Overall, only a breach of 0.6460 (no change in ‘strong resistance’ level) would indicate that the likelihood of AUD breaking clearly below 0.6370 has faded. Note that AUD popped briefly to a high of 0.6461 in the Asian session yesterday."