In light of the recent price action, AUD/USD is now poised to extra gains to the 0.6800 region, comment Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.
24-hour view: “The strong surge in AUD yesterday came as a surprise (we were expecting AUD to range trade). The overbought rally has room to extend but a clear break of 0.6800 is unlikely today. It is worth noting there is another resistance at 0.6770. On the downside, a breach of 0.6680 (minor support is at 0.6715) would indicate that AUD is not advancing further.”
Next 1-3 weeks: “Two days ago (22 Nov, spot at 0.6605), we highlighted that AUD is under mild downward pressure. However, we noted that it has to break and stay below 0.6570 before further decline is likely. Yesterday (23 Nov), AUD took out our ‘strong resistance’ level of 0.6690 as it surged to a high of 0.6739. The rapid rise has shifted the risk to the upside towards 0.6800. Overall, only a break of 0.6645 would indicate that the upside risk has faded.”
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