AUD/USD scope for extra weakness – UOB

In light of the recent sell off in AUD/USD, FX Strategists at UOB Group suggested there could be scope for further retracements in the next weeks.

Key Quotes

“On Wednesday, 01 Mar (spot at 0.7665), we were of the view that AUD has formed a temporary top and expected the pull-back to extend lower to 0.7605, possibly 0.7570”.

“The rapid pace of the decline yesterday came as a pleasant surprise as AUD plummeted to a low 0.7557. The sharp drop coupled with the vastly improved downward momentum suggests further weakness from here”.

“However, the next support at 0.7510 is rather strong level and may not yield so easily. The ‘break-down’ level near 0.7605 is acting as a very strong resistance now but only a move back above 0.7645 would indicate that the current AUD weakness has stabilized”.