AUD/USD room for extra gains – UOB

FX Strategists at UOB Group stay neutral on the Aussie Dollar, adding that there is still scope for a continuation of the up move.

Key Quotes

24-hour view: “The strong recovery in AUD that hit a high of 0.7854 last Friday came as a surprise. The advance appears to have room to extend above the strong 0.7880 resistance but a sustained move above this level is not expected (there is another strong resistance at 0.7905). Only a move back below 0.7810 would indicate that the immediate upward pressure has eased (minor support is at 0.7830)”.

Next 1-3 weeks: “After trading sideways for several days, AUD staged a surprisingly strong up-move last Friday and is currently approaching the top of our previously expected 0.7715/0.7880 range. While we continue hold a neutral view on AUD, improving shorter-term momentum suggests that there is scope for the current strong rebound to extend higher towards 0.7940. At this stage, the odds for a sustained move above this level are not high (next resistance is at 0.7990). Overall, we expect AUD to stay underpinned for the next several days and only a break below the key support at 0.7780 would indicate that the current mild upward pressure has eased”.