Not expected to breach 0.6200 – UOB Group

Slight increase in momentum suggests downward bias in Australian Dollar (AUD), but it is not expected to breach 0.6200. In the longer run, if AUD closes above 0.6310, it could trigger an advance to 0.6355, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Slight increase in momentum suggests downward bias

24-HOUR VIEW: “When AUD was at 0.6285 last Friday, we pointed that it ‘is facing mild upward pressure, and it could test 0.6310.’ However, AUD rose less than expected to 0.6303 before easing. AUD closed at 0.6277 (-0.11%) and traded on a soft note after opening today. The slight increase in downward momentum suggests downward bias in AUD today, but we do not expect a breach of the strong support at 0.6200. Resistance is at 0.6275, followed by 0.6300.”

1-3 WEEKS VIEW: “Last Thursday (06 Feb, spot at 0.6280), we noted that ‘upward momentum is beginning to build, and if AUD closes above 0.6310, it could trigger an advance to 0.6355.’ AUD rose to 0.6303 on Friday before easing. There has been no further increase in upward momentum, but only a breach of 0.6200 (no change in ‘strong support’ level) would indicate the likelihood of AUD breaking clearly above 0.6310 has faded.”