To trade in a sideways range of 0.6715/0.6770 – UOB Group

The Australian Dollar (AUD) is likely to trade in a sideways range of 0.6715/0.6770. In the longer run, bias for AUD remains on the downside; a clear break below 0.6700 would suggest further decline, potentially to 0.6670, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.

Bias for AUD remains on the downside

24-HOUR VIEW: “The title of our update yesterday was ‘A break 0.6700 is not ruled out; given the mild momentum, AUD may not be able to maintain a foothold below this level.’ However, AUD did not break 0.6700, trading choppily between 0.6702 and 0.6743, before closing at 0.6742 (+0.35%). The price action is likely part of a sideways trading phase, probably in a range of 0.6715/0.6770.”

1-3 WEEKS VIEW: “We highlighted yesterday (10 Oct, spot at 0.6720) that ‘while there has been no significant increase in momentum, the bias for AUD remains on the downside.’ We added, ‘a clear break below 0.6700 would suggest AUD could decline further, potentially to 0.6670,’ and ‘the downward bias is intact provided that AUD remains below 0.6785 (‘strong resistance’ level).’ AUD subsequently dropped to 0.6702, then rebounded. We continue to hold the same view for now.”