AUD/USD: A breach above 0.6755 to lead AUD to 0.6800 – UOB Group
|The Australian Dollar (AUD) is likely to trade in a sideways range of 0.6685/0.6735. If AUD can surpass 0.6755, it could continue to rise to 0.6800, UOB Group analysts Quek Ser Leang and Peter Chia note.
AUD is set to rise to 0.6800
24-HOUR VIEW: “We noted yesterday that ‘the underlying tone seems to be firming.’ We also indicated that while AUD ‘could edge above 0.6685, the major resistance at 0.6705 is unlikely to come under threat.’ The sudden surge in momentum that sent AUD surging to a high of 0.6734 came was surprising. The sharp rally appears to be overdone, and instead of continuing to rise, AUD is likely to trade sideways at these higher levels. Expected range for today: 0.6685/0.6735.”
1-3 WEEKS VIEW: “On Monday (01 Jul, spot at 0.6670), we noted ‘a slight increase in upward momentum.’ We indicated that ‘as long as AUD remains above 0.6610, it is likely to edge higher, but the likelihood of it breaking clearly above the major resistance zone of 0.6705/0.6715 is low for now.’ After trading sideways for a couple of days, AUD lifted off and broke above the major resistance zone, reaching a high of 0.6734. Not surprisingly, there has been a sharp increase in upward momentum. That said, there is another significant resistance level at 0.6755. If AUD can surpass this level, it could continue to rise to 0.6800. Overall, we continue to expect a higher AUD, provided that it remains above 0.6665 (‘strong support’ level was at 0.6625 yesterday).”
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