AUD/USD: Sustainable gains await above 0.7400 – UOB

In opinion of FX Strategists at UOB Group, AUD/USD is expected to advance further once 0.7400 is cleared in the short-term horizon.

Key Quotes

24-hour view: “We highlighted yesterday that ‘downward pressure has eased’ and we expected AUD to ‘trade sideways within a range of 0.7270/0.7350’. However, AUD rebounded to 0.7368 before closing on a firm note at 0.7358 (+0.48%). The rebound lacks momentum and AUD is unlikely to strengthen much further. For today, AUD is more likely to trade sideways between 0.7310 and 0.7370.”

Next 1-3 weeks: “Two days ago (09 Mar, spot at 0.7275), we highlighted that AUD is in a consolidation and we expected it to trade within a range of 0.7170/0.7370. We did not anticipate the rapid manner by which AUD approaches the top of the expected range (high of 0.7368 during NY session). While upward pressure appears to be building, it is premature to expect a sustained advance. From here, AUD has to close above 0.7400 before a sustained advance is likely. At this stage, the chance for AUD to close above 0.7400 is not high but it would remain intact as long as AUD does not move below 0.7250 within these couple of days.”