AUD/USD now looks to the downside – UOB

AUD/USD now shifted the focus to the 0.7560 region in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We expected AUD to ‘trade sideways within a broad 0.7615/0.7700 range’ last Friday. AUD subsequently traded between 0.7632 and 0.7704 before closing at 0.7642 (-0.45%). AUD traded on a soft not after opening this morning and there is scope for AUD to test last week’s low near 0.7590. For today, a sustained decline below this level is unlikely (next support is at 0.7560). Resistance is at 0.7665 followed by 0.7690.”

Next 1-3 weeks: “Last Thursday (28 Jan, spot at 0.7635), we highlighted that ‘risk has shifted quickly to the downside’ and we held the view that AUD ‘is likely to trade with a downward bias towards 0.7560’. While downward momentum has waned, there is no change in our view for now. Only a break of 0.7730 (no change in ‘strong resistance’ level) would indicate that the downside risk has dissipated.”