Australian Dollar: Bearish outlook retained below 0.7140 - UOB

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann describe AUD/USD price action as range-bound around 0.7115, with intraday expectations for 0.7095–0.7125. They had turned negative early last week, targeting 0.7050, but now concede that the probability of reaching that level has diminished considerably. On a 1–3 month view, they see scope for the Australian Dollar to continue rising toward the year-to-date high at 0.7277.

Australian Dollar consolidates in tight band

"24-HOUR VIEW: We indicated yesterday that “the current price movements are likely part of a range-trading phase between 0.7105 and 0.7135.” While AUD then fluctuated within a lower range of 0.7093/0.7126, it closed largely unchanged at 0.7115 (-0.05%). We are not able to derive much from the price action. Today, AUD could trade between 0.7095 and 0.7125."

"1-3 WEEKS VIEW: We turned negative on AUD early last week. Last Thursday (17 Sep, spot at 0.7090), we highlighted that AUD “is expected to drop to 0.7050.” After AUD rose to 0.7140, we highlighted yesterday (22 Sep, spot at 0.7120) that “as our ‘strong resistance’ at 0.7140 has not been clearly breached, we will maintain our negative stance for now.” However, we added that “the likelihood of AUD reaching 0.7050 has diminished considerably.” We continue to hold the same view."

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