Australian Dollar: Consolidation continues below resistance against US Dollar - UOB

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann see AUD/USD consolidating around 0.7120 after a brief spike to 0.7140. Intraday price action is viewed as part of a 0.7105–0.7135 range. They still hold a negative 1–3 week stance, conditional on resistance at 0.7140, but acknowledge that the probability of a drop to 0.7050 has diminished considerably.

Australian Dollar stuck in tight range

"24-HOUR VIEW: Yesterday, AUD rose briefly to 0.7140 before retreating to close 0.11% lower at 0.7119. The brief advance did not result in any increase in upward momentum, and the current price movements are likely part of a range-trading phase between 0.7105 and 0.7135."

"1-3 WEEKS VIEW: After holding a negative AUD view since last Monday, in our most recent narrative from Thursday (17 Sep, spot at 0.7090), we stated that AUD “is expected to drop to 0.7050.” We added that “we will maintain our view as long as AUD holds below 0.7140 (‘strong resistance’ level).” Yesterday, AUD rose briefly to 0.7140 and then retreated. As our ‘strong resistance’ level has not been clearly breached, we will maintain our negative stance for now. However, the likelihood of AUD reaching 0.7050 has diminished considerably."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)