United Overseas Bank’s (UOB) Quek Ser Leang notes AUD/USD slipped below prior consolidation but still trades within 0.6960–0.7000 intraday. On a 1–3 week view, earlier strong momentum toward 0.7045 has faded somewhat, yet the upside scenario remains valid while 0.6950 holds. Longer term, the bank still sees a negative structure with focus on 0.6835 and 0.6707.

Aussie Dollar holds support as momentum fades

"24-HOUR VIEW: After AUD traded sideways between 0.6986 and 0.7012 last Thursday, we indicated on Friday that “further sideways trading appears likely today, probably within a range of 0.6980/0.7015.” The subsequent price movements did not unfold as expected, as AUD eased to a low of 0.6966. The decline did not result in a clear increase in downward momentum. Today, we expect AUD to trade in a range between 0.6960 and 0.7000."

"1-3 WEEKS VIEW: Last Wednesday (15 Jul, spot at 0.6975), we indicated that “upward momentum is starting to build, but it is too early to determine whether AUD can break the significant resistance at 0.7015.” After AUD rose to 0.7021, we highlighted on Thursday (16 Jul, spot at 0.7005) that “the rapid increase in momentum suggests AUD could rise toward 0.7045.” However, instead of continuing to advance, AUD pulled back to a low of 0.6966 on Friday. Momentum is starting to fade, but only a breach of 0.6950 (no change in ‘strong support’ level) would indicate that AUD is not rising toward 0.7045."

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