AUD/USD looks firm above 0.6795 – UOB

AUD/USD is seen sticking to its positive view while above the 0.6795 level, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday ‘the rapid rally is running ahead of itself but still robust momentum suggests AUD could test 0.6845 first’. The subsequent AUD strength exceeded our expectation as the break of 0.6845 sent AUD soaring to 0.6862. From here, AUD could edge above the 0.6862 top but severely overbought conditions suggest any advance is part of a higher trading range of 0.6830/0.6870 (a sustained rise above 0.6870 is not expected)”.

Next 1-3 weeks: “While we highlighted yesterday (03 Dec, spot at 0.6815) that AUD is ‘is expected to trade with an upward bias towards 0.6870’, we were of the view that it could take up to several days before AUD approaches 0.6870. However, AUD extended its rally from Monday and came within sight of 0.6870 (high of 0.6862 during London hours). The two-day rally of +1.30% is running ahead of itself and while AUD is still strong, it may not be ready to challenge the next resistance at 0.6900 just yet. All in, AUD is expected to trade with a firm footing as long as 0.6795 is intact (‘strong support’ level was at 0.6765 yesterday)”.