FX Strategists at UOB Group has now shifted their near term stance on the Aussie Dollar to neutral from bullish.
Key Quotes
24-hour view: “We expected 0.7590 to offer solid support last Friday but AUD cracked this level easily and dropped to a low of 0.7560. The sharp drop is running ahead of itself and while a retest of 0.7560 is not ruled out, a clear break below this level is not expected. On the upside, only a move back above 0.7630 would indicate that the current mild downward pressure has eased”.
Next 1-3 weeks: “Our recent bullish expectation was proven wrong quickly as AUD took out the ‘stop-loss’ level at 0.7565 last Friday (low of 0.7560). While the outlook for AUD still appears to be positive from a longer-term perspective, shorter-term indicators suggest that AUD has moved into a consolidation phase and is expected to trade sideways from here. Only a break back above last week’s top near 0.7675/80 would indicate that AUD has started the next up-leg towards 0.7740. In the meanwhile, we expect AUD to consolidate and trade sideways, likely within a 0.7530/0.7680 range”.
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