The outlook for AUD/USD is seen as negative while below the 0.7665 level in the next weeks, in opinion of FX Strategists at UOB Group.
Key Quotes
24-hour view: “Our expectation for AUD to ‘edge higher to 0.7660’ was incorrect as it dropped to 0.7589 (high has been 0.7649). Despite the relatively sharp decline, downward momentum has not improved by much. That said, the risk is still on the downside but the major support at 0.7560 is likely out of reach (minor support is at 0.7580). Resistance is at 0.7620 followed by 0.7640.”
Next 1-3 weeks: “We have expected AUD to weaken since last week. In our latest narrative from Wednesday (03 Feb, spot at 0.7605), we highlighted that ‘outlook for AUD is still negative but solid support at 0.7560 may not break so soon’. Shorter-term downward momentum has improved slightly and while the focus is still at 0.7560, it may take a few more days before AUD can break this level. Overall, the current negative outlook is deemed intact as long as AUD does not move above 0.7665 (‘strong resistance’ level previously at 0.7685). Looking ahead, a break of the solid support at 0.7560 could potentially trigger a rapid decline to 0.7510.”
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