AUD/USD: To rise above 0.6310 – UOB Group
Chance for Australian Dollar (AUD) to rise above 0.6310; it remains to be seen if it can maintain a foothold above this level. In the longer run, buildup in momentum is fading; a break below 0.6230 would mean that AUD is likely to trade in a range, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Below 0.6230, AUD is likely to trade in a range
24-HOUR VIEW: "While we expected AUD to 'trade with a downward bias' yesterday, we pointed out, 'given the mild downward momentum, any decline is limited to a test of 0.6230.' Our expectation did not turn out, as AUD traded in a 0.6262/0.6302 range, closing at 0.6295 (+0.28%). The price action has resulted in a tentative buildup in momentum. Today, there is a chance for AUD to rise above 0.6310, but it remains to be seen if it can maintain a foothold above this level. The probability of AUD breaking above 0.6330 appears low. Support is at 0.6265; a breach of 0.6245 would suggest that the upward pressure has eased."
1-3 WEEKS VIEW: "Last Thursday (06 Feb, spot at 0.6280), we indicated that 'if AUD closes above 0.6310, it could trigger an advance to 0.6355.' AUD did not make any headway on the upside, and yesterday (11 Feb, spot at 0.6270), we highlighted that that the recent 'buildup in momentum is fading, and if AUD breaks below 0.6230 (‘strong support’ level), it would mean that AUD is likely to trade in a range.' Although short-term momentum has increased somewhat, AUD must break and remain above 0.6310 before further advance can be expected. The likelihood of AUD breaking clearly above 0.6310 will remain intact as long as 0.6230 (no change in ‘strong support’) is not breached."
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FXStreet Insights Team
FXStreet
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