Australian Dollar: Gains Against US Dollar Capped by Consolidation – UOB

0.6995–0.7030 is the expected intraday range for AUD/USD. Following recent gains, the pair is consolidating in the short term, according to United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann. Their 1–3 week outlook remains constructive, although upward momentum is easing. A break below 0.6985 would leave the 0.7070 target out of reach. Longer-term EMAs continue to signal downside risk towards previous lows.

0.7070 target at risk as upward momentum eases

"24-HOUR VIEW: After AUD rose more than we expected two days ago, we highlighted yesterday that “there is a chance for AUD to rise further, but slowing momentum and overbought conditions suggest any advance is unlikely to break above 0.7045.” Our view did not turn out, as AUD fluctuated between 0.6995 and 0.7036 before settling at 0.7020 (-0.13%). The current price movements are likely part of a consolidation phase. Today, we expect AUD to trade between 0.6995 and 0.7030."

"1-3 WEEKS VIEW: We turned positive on AUD two days ago (21 Oct, spot at 0.7005), indicating that AUD “could rise toward 0.7035.” After AUD tested 0.7035 with a high of 0.7036, we highlighted yesterday (22 Oct, spot at 0.7025) that AUD “could advance further, though the next technical target at 0.7070 may not come into view so soon.” AUD subsequently rose to 0.7036 again before pulling back to a low of 0.6995. Upward momentum is starting to slow and a break below 0.6985 (no change in ‘strong support’ level) would mean that 0.7070 is out of reach this time around."

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