AUD/USD: Set to test the major support at 0.6600 – UOB Group

There is a chance for Australian Dollar (AUD) to test the major support at 0.6600 before a recovery is likely. In the longer run, advance in AUD from early last week has come to an end; AUD is likely to consolidate in a range of 0.6600/0.6710, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

AUD is likely to consolidate in a range of 0.6600/0.6710

24-HOUR VIEW: "Subsequent to the volatile price movements in AUD two days ago, we indicated yesterday that 'the outlook is mixed, and AUD could trade in a range, likely between 0.6635 and 0.6685.' Our view was incorrect, as AUD fell to a low of 0.6608 before closing at 0.6613 (-0.62%). Although the decline appears to be overdone, there is a chance for AUD to test the major support at 0.6600 before a recovery is likely. Based on the current momentum, a sustained decline below 0.6600 is unlikely. Resistance is at 0.6635, followed by 0.6650."

1-3 WEEKS VIEW: "We revised our view to neutral yesterday (18 Sep, spot at 0.6655), indicating that 'the advance from early last week has come to an end.' We also indicated that AUD 'is likely to consolidate in a range of 0.6600/0.6710.' While the subsequent drop to 0.6608 has resulted in an increase in short-term downward momentum, it is not sufficient to indicate a sustained decline for now. In other words, we continue to expect AUD to trade in a range of 0.6600/0.6710."