AUD/USD remains in a consolidation phase – UOB

In opinion of FX Strategists at UOB Group, AUD/USD should remain side-lined within the 0.7200-0.7370 range in the next weeks.

Key Quotes

24-hour view: “We did not expect the drop in AUD to 0.7283 last Friday (we were expecting sideway-trading). AUD extended its decline during early Asian hours and could decline further. That said, it is left to be seen if it can maintain a foothold below 0.7250. The next support at 0.7220 is unlikely to come under threat. Resistance is at 0.7300 followed by 0.7325.”

Next 1-3 weeks: “Last Friday (11 Mar, spot at 0.7355), we highlighted while upward pressure appears to be building but AUD has to close above 0.7400 before a sustained advance is likely. We added, ‘the chance for AUD to close above 0.7400 is not high but it would remain intact as long as AUD does not move below 0.7250 within these couple of days’. AUD subsequently dropped to 0.7283 before extending its decline during Asian hours. While 0.7250 is not breached, the build-up in momentum has more or less fizzled out. In other words, AUD is still likely in a consolidation phase and is expected to trade between 0.7200 and 0.7370.”