AUD/USD: Support at 0.6585 is likely out of reach for now – UOB Group

Strong momentum indicates further Australian Dollar (AUD) weakness; the significant support at 0.6585 is likely out of reach for now. In the long run, AUD is expected to continue to decline; the level to watch is a significant support at 0.6585, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.  

The level to watch is a significant support at 0.6585

24-HOUR VIEW: “The sharp drop in AUD that reached a low of 0.6614 was surprising (we were expecting sideways trading). Strong momentum indicates further AUD weakness is likely. However, the significant support at 0.6585 is likely out of reach for now. There is another support level at 0.6605. To keep the momentum going, AUD must remain below 0.6665 with minor resistance at 0.6650.”

1-3 WEEKS VIEW: “We have held a negative view in AUD since early this month. As we tracked the decline, we highlighted two days ago (22 Oct, spot at 0.6715) that ‘the rejuvenated momentum suggests that the AUD weakness from early this month remains intact.’ We added, ‘the level to monitor is 0.6620.’ AUD subsequently rebounded, but did not break our ‘strong resistance’ level at 0.6705. Yesterday, in a sudden move, it plummeted to 0.6614. Downward momentum remains strong and we continue to expect AUD to decline. The level to watch is a rather significant support at 0.6585. On the upside, the ‘strong resistance’ level has moved lower to 0.6685.”