FX Strategists at UOB Group now believe the probability of AUD/USD testing 0.6950 in the near term has lost some momentum.

Key Quotes

24-hour view: “While our expectation for AUD to “drift lower to 0.6865” was not wrong, the subsequent strong bounce from 0.6862 came as a surprise (overnight high of 0.6913). Despite the rapid rebound, upward momentum has not improved by much. That said, AUD could move above the 0.6915 level but the odds for a break of 0.6930 are not high. Support is at 0.6880 followed by the still rather solid level of 0.6865”.

Next 1-3 weeks: “AUD dipped to 0.6862 yesterday (07 Nov) before rebounding to close slightly higher at 0.6899 (+0.21%). Upward momentum has barely improved and as highlighted on Wednesday (06 Nov, spot at 0.6895), our expectation for AUD to move to 0.6950 is unlikely to pan out. That said, only a break of 0.6845 (no change in ‘strong support’ level) would indicate that the slim risk of a higher AUD has been snuffed out. Looking ahead, a break of the ‘strong support’ would indicate AUD could trade sideways for a period”.