The Australian Dollar (AUD) is likely to trade between 0.6450 and 0.6510. Longer term, the bearish bias remains, but the Australian dollar must close below 0.6440 before a move to 0.6405 is forecast, UOB Group forex analysts Kwek Ser Liang and Peter Chia note.
The bearish bias remains intact
24-hour view: “The Australian dollar fell as we predicted two days ago. Yesterday, we noted that ‘Instead of continuing to weaken today, the Australian dollar is likely to trade in a range between 0.6485 and 0.6530.’ We were wrong. The Australian dollar continued to fall to a low of 0.6451 and then rebounded to close at 0.6479 (-0.46%). Given the bounce, there was no significant increase in downside momentum, and it is unlikely If the Australian dollar weakens further today, we expect the Australian dollar to trade between 0.6450 and 0.6510.”
1-3 week view: “On Tuesday (18 November, spot at 0.6490), we highlighted that “bearish momentum is starting to build, and the AUD is likely to trade with a bearish bias towards 0.6460”. Yesterday, the AUD broke below 0.6460 and bottomed at 0.6451. While the bearish bias remains, the AUD should close below 0.6440 before moving to 0.6405 can be expected The possibility of the Australian dollar closing below 0.6440 will remain as long as 0.6525 (formerly “strong resistance” level at 0.6540) is not breached.
