AUD/USD: May drop below 0.6550 – UOB Group

The Australian Dollar (AUD) is expected to trade in a range between 0.6550 and 0.6600. In the longer run, the potential for further sustained decline may be limited; the next level to monitor is 0.6520, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Next level to monitor is 0.6520

24-HOUR VIEW: “AUD traded in a range between 0.6540 land 0.6585 yesterday, closing slightly higher at 0.6582 (+0.15%). Momentum indicators are turning neutral, and AUD is expected to continue to trade in a range, likely between 0.6550 and 0.6600.”

1-3 WEEKS VIEW: “In our most recent narrative from two days ago (30 Oct, spot at 0.6565), we pointed out the ‘Although the weakness has not stabilised, given that the current decline is entering its second month, the potential for further sustained weakness may be limited.’ We also pointed out ‘The next level to monitor is 0.6520.’ There is no change in our view. Overall, only a breach of 0.6620 (no change in ‘strong resistance’ level) would mean that the weakness in AUD has stabilised.”