AUD/USD: Scope for further downside – UOB

In opinion of FX Strategists at UOB Group, AUD/USD could give away further ground in the next weeks.

Key Quotes

24-hour view: “AUD closed on a soft note at 0.7233 yesterday (-0.28%). Downward momentum has improved a tad and the bias is on the downside. That said, a clear break of the major support at 0.7200 appears unlikely (next support is at 0.7175). Resistance is at 0.7255 followed by 0.7280.”

Next 1-3 weeks: “In our latest update from last Friday (17 Sep, spot at 0.7290), we indicated that ‘a break of the solid support at 0.7260 would suggest that AUD could weaken further to 0.7225’. AUD subsequently cracked 0.7260 and plummeted to 0.7221 on Monday (20 Sep). Further AUD weakness appears likely even though oversold conditions could slow the pace of any decline. The next support is at 0.7200 followed by 0.7175. Overall, the current weak phase that started last week is deemed intact as long as the ‘strong resistance’ level at 0.7305 is not breached.”