Australian Dollar (AUD) is likely to trade between 0.6450 and 0.6510. In the longer run, downward bias remains intact, but AUD must close below 0.6440 before a move to 0.6405 can be expected, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Downward bias remains intact
24-HOUR VIEW: “AUD fell as we expected two days ago. Yesterday, we indicated that ‘instead of continuing to weaken today, AUD is more likely to trade in a range between 0.6485 and 0.6530’. We were incorrect. AUD continued to drop to a low of 0.6451 and then rebounded to close at 0.6479 (-0.46%). Given the rebound, there has been no significant increase in downward momentum, and AUD is unlikely to weaken much further. Today, we expect AUD to trade between 0.6450 and 0.6510.”
1-3 WEEKS VIEW: “On Tuesday (18 Nov, spot at 0.6490), we highlighted that ‘downward momentum is starting to build, and AUD is likely to trade with a downward bias toward 0.6460’. Yesterday, AUD broke below 0.6460 and reached a low of 0.6451. While the downward bias remains intact, AUD must close below 0.6440 before a move to 0.6405 can be expected. The likelihood of AUD closing below 0.6440 will remain intact as long as 0.6525 (‘strong resistance’ level previously at 0.6540) is not breached.”
