Australian Dollar: Downward bias toward 0.6980 versus US Dollar – UOB

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann keep a negative stance on AUD/USD after a period of quiet price action around 0.7020. They see a mild intraday downside bias, though any immediate drop is unlikely to reach 0.6980, while over the next one to three weeks they expect the pair to gravitate toward the month-to-date low near 0.6980 unless 0.7045 is broken.

Mildly weaker Aussie within tight band

"24-HOUR VIEW: After AUD consolidated as we expected last Thursday, we highlighted the following on Friday: “We were not wrong, as AUD traded between 0.7001 and 0.7042, closing largely unchanged at 0.7016 (+0.03%). Today, AUD is likely to consolidate further, though the softer underlying tone points to a lower range of 0.6995/0.7035.” AUD then traded between 0.6990 and 0.7024 before closing largely unchanged again at 0.7017 (+0.02%). Despite the relatively quiet price action, there has been a slight increase in downward momentum. Today, we expect AUD to trade with a downward bias, but given the lacklustre momentum, any decline is unlikely to reach the major support at 0.6980. On the upside, resistance levels are at 0.7020 and 0.7030."

"1-3 WEEKS VIEW: We revised our AUD view to negative last Thursday (18 Jun, spot at 0.7025). We indicated that “downward momentum is increasing, and AUD is likely to drop toward the month-to-date low, near 0.6980.” We will continue to hold the same view as long as 0.7045 (‘strong resistance’ level previously at 0.7060) is not breached."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)