AUD/USD points to further consolidation – UOB

FX Strategists at UOB Group keep the neutral tone on the Aussie Dollar, hinting at the likeliness of extra consolidation in the near term.

Key Quotes

24-hour view: “The strong support indicated at 0.7740 yesterday was unchallenged as AUD reversed its initial decline and rebounded to close largely unchanged for the day. While upward momentum is not strong, the recovery from the 0.7772 low has room to extend higher but a sustained move above 0.7850 seems unlikely (this level is followed by another strong resistance at 0.7880). Support is at 0.7795 followed by yesterday’s low near 0.7770”.

Next 1-3 weeks: “We have been highlighting the diminished odds for further AUD weakness since last Friday (02 Mar, spot at 0.7760) and the break of 0.7820 yesterday (high of 0.7842) confirms that the recent mild downward pressure has eased. However, there is no change to the neutral outlook but AUD has likely moved into a consolidation phase and is expected to trade sideways from here, likely within a 0.7715/0.7880 range”.