May not have enough momentum to test 0.6870 – UOB Group

The Australian Dollar (AUD) is likely to trade sideways, probably in a range of 0.6800/0.6855. In the longer run, there is still room for AUD to rise further, but there may not be enough momentum for it to challenge 0.6870, UOB Group FX analysts Quek Ser Leang and Peter Chia note.

Rangebound between 0.6800 and 0.6855

24-HOUR VIEW: “We expected AUD to trade sideways yesterday. Our expectation was incorrect, as AUD rose to 0.6853, closing at its highest level this year (0.6838, +0.45%). Despite the advance, upward momentum has barely increased, and AUD is unlikely to rise much further. Today, we continue to expect AUD to trade sideways, probably in a range of 0.6800/0.6855.”

1-3 WEEKS VIEW: “We continue to hold the same view as last Friday (20 Sep, spot at 0.6800). As highlighted, while there is still room for AUD to continue to rise, it may not have enough momentum to challenge to significant resistance at 0.6870. On the downside, a breach of 0.6770 (strong support’ level was at 0.6740 yesterday) would mean that the upward pressure that started early last week has eased.”