Room for Australian Dollar (AUD) to rise above 0.6755. Overbought conditions suggest it might not be able to maintain a foothold above this level, but increasing upward momentum suggests AUD is likely to continue to rise to 0.6800, UOB Group analysts note.
AUD is likely to trade towards 0.6800
24-HOUR VIEW: “Last Friday, we noted that ‘upward momentum has increased, albeit not much.’ We highlighted that AUD ‘is likely to edge higher, but the 0.6755 level is expected to offer solid resistance.’ AUD rose as expected, reaching a high of 0.6753. While there is room for AUD to rise above 0.6755 today, overbought conditions suggest it might not be able to maintain a foothold above this level. The resistance level at 0.6770 is also unlikely to come under threat. Support levels are at 0.6730 and 0.6715.”
1-3 WEEKS VIEW: “In our update from last Thursday (04 Jul, spot at 0.6710), we indicated that ‘if AUD can surpass 0.6755, it could continue to rise to 0.6800.’ Last Friday, AUD rose to a high of 0.6753. While 0.6755 has not been clearly breached yet, increasing upward momentum suggests it is likely to continue to rise to 0.6800. Overall, only a breach of 0.6690 (‘strong support’ level previously at 0.6665) would indicate that the AUD strength that started early last week has come to an end.”
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