Australian Dollar: Can the developing uptrend extend to 0.7035 against US Dollar? – UOB

AUD/USD has regained the 0.70 level as a weaker US Dollar lent support, with UOB strategists Quek Ser Leang and Lee Sue Ann noting that momentum picked up more quickly than anticipated. Although intraday advances may remain confined to a narrow range, the outlook over 1–3 weeks now suggests further gains towards 0.7035, as long as the pair stays above a nearby zone of strong support.

Can the Australian Dollar Build on Stronger Momentum Above 0.70?

"24-HOUR VIEW: After AUD rose to a high of 0.6993 two days ago, we highlighted the following yesterday: “Upward momentum is increasing, albeit not significantly. Today, there is scope for AUD to test 0.7000. A clear break above this level is unlikely. The major resistance at 0.7015 is also unlikely to come into view.” We did not expect upward momentum to strengthen so quickly as AUD soared to a high of 0.7017, closing 0.34% higher at 0.7003. While further AUD strength is not ruled out, negative divergence is forming on momentum indicators, and any advance is likely to stay within a range of 0.6985/0.7020."

"1-3 WEEKS VIEW: On Monday (19 Oct, spot at 0.6965), we highlighted that AUD “appears to have moved into a range-trading phase,” and “for the time being, we expect it to trade between 0.6915 and 0.7015.” Yesterday, AUD broke above 0.7015 as it rose to a high of 0.7017. Upward momentum is starting to build, and AUD could rise toward 0.7035 as long as it holds above the ‘strong support’ level, currently at 0.6965."

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