Bulls set to test the 0.6625 resistance – UOB Group

The Australian Dollar (AUD) is unlikely to weaken much further; it is likely to trade in a 0.6580/0.6625 range. If AUD breaks below 0.6580, it would suggest that it is not ready to head higher to 0.6660, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.

A test of 0.6625 is around the corner

24-HOUR VIEW: “While we expected AUD to strengthen yesterday, we indicated that ‘it remains to be seen if it can break above 0.6660.’ We also indicated that ‘support is at 0.6615, and a breach of 0.6600 would indicate that AUD is not strengthening further.’ AUD subsequently rose less than expected to 0.6643, pulling back sharply to a low of 0.6595. The sharp pullback seems a tad overdone, and AUD is unlikely to weaken much further. Today, we expect AUD to trade in a 0.6580/0.6625 range.”

1-3 WEEKS VIEW: “After AUD rose two days ago, we indicated yesterday (14 Aug, spot at 0.6630), that ‘upward momentum has increased further.’ We noted the next level to focus on is 0.6660. AUD subsequently rose to 0.6643 before staging a surprisingly sharp pullback. The buildup in momentum is beginning to ease. From here, if AUD breaks below 0.6580 (no change in ‘strong support’ level), it would suggest that it is not ready to head higher to 0.6660.”