AUD/USD further consolidation likely near term – UOB

The pair appears to have moved into a consolidation phase, according to FX Strategists at UOB Group.

Key Quotes

24-hour view: “The anticipated strength exceeded our expectation as AUD cracked the strong resistances at 0.7800 and 0.7820 with ease (high has been 0.7842). The subsequent sharp and swift pullback from the high suggests that a short-term top is in place. The decline from the top appears to have room to extend lower but any weakness is expected to encounter solid support at 0.7740 (followed by another strong support at 0.7715). The 0.7842 high is expected to be strong enough to cap any intraday rebound (0.7820 is already quite a strong level)”.

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 0.7715/7880 range”.