The Australian Dollar (AUD) will likely trade with a bullish bias; Any advance is expected to face strong resistance at 0.6620. Longer term, the AUD’s weakness over the past month has stabilized; AUD is expected to trade in a range of 0.6535/0.6655 for now, according to UOB Group FX analysts Quek Ser Leang and Lee Sue Ann.
AUD weakness over the past month appears to have stabilized
24 HOUR VIEW: “We expected the AUD to trade in a range between 0.6550 and 0.6600 last Friday. The AUD then traded in a narrower range of 0.6554/0.6591, closing at 0. 6560. Opened with a gap higher today. There has been a slight increase in bullish momentum, and AUD is likely to trade with a bullish bias. However, any advance is expected to face strong resistance at 0.6620. Support is at 0.6570, followed by 0.6555.”
1-3 WEEK VIEW: “We have maintained a negative view on AUD since the beginning of last month. In our most recent narrative last Wednesday (October 30, spot at 0.6565), we noted that ‘Although the weakness has not stabilized, given that the current decline is entering its second month, the potential for further sustained weakness may be limited.’ We also note that ‘The next level to monitor is 0.6520, and only a break of 0.6620 (“strong resistance” level) would mean that AUD weakness has stabilized.’ The AUD gapped higher today and rose above 0.6600. Although our “strong resistance” level has not been clearly broken, the bearish momentum has largely faded. AUD over the past month has stabilized. From here, AUD is expected to trade in a range, probably between 0.6535 and 0.6655.”
Source: Fx Street
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