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Extra gains in AUD/USD are expected on a close above 0.7700, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We expected AUD to ‘trade between 0.7590 and 0.7640’ yesterday. Our view was incorrect as AUD briefly dropped to 0.7585 before snapping back up to 0.7649. Upward momentum is beginning to improve and AUD could edge higher but a break of the solid resistance at 0.7675 is unlikely. On the downside, a breach of 0.7620 would indicate that the build-up in momentum has fizzled out.”

Next 1-3 weeks: “We have held the same view since last Thursday (08 Apr, spot at 0.7615) where the outlook for AUD is mixed and it is likely ‘trade within a 0.7550/0.7675 range’. Our view was not wrong as AUD traded mostly sideways since then. While shorter-term momentum is beginning to improve, it is premature to expect a sustained advance. AUD has to close above 0.7700 before a move to 0.7745 can be expected. At this stage, the prospect for such a scenario is not high but it would remain intact as long as AUD does not move below 0.7580.”