FX Strategists at UOB Group see the pair attempting to retake tge 0.7300 handle and above in the near term.
24-hour view: “We highlighted yesterday “AUD could try to break above 0.7300 again but the prospect for a sustained move above this level is not high”. In line with expectation, AUD moved briefly above 0.7300 and touched 0.7303 but was unable to hold on to its gains. The subsequent sharp sell-off after the release of FOMC statement resulted in a rapid drop to 0.7247. The swift decline appears to be running ahead of itself and we do not expect AUD to move significantly below this level. All in, AUD is more likely to consolidate and trade sideways, likely within 0.7240/0.7295 range”.
Next 1-3 weeks: “We have held the same view since last Friday (02 Nov, spot at 0.7205) wherein there is “scope for AUD to test the key and critical 0.7260 resistance”. We added, a break of this ‘key and critical’ resistance would suggest that the 0.7021 low seen on 26 Oct could be a mid to long-term bottom. From here, we are anticipating AUD to continue to move higher to the September’s peak of 0.7315. A breach of this level would shift the focus to 0.7380. On the downside, the ‘key support’ has moved higher to 0.7150 from 0.7110 yesterday. All in, we expect AUD to stay underpinned in the coming days as long as the ‘key support’ is intact”.
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