Oversold decline in Australian Dollar (AUD) could extend to 0.6560 before stabilisation can be expected. In the longer run, potential for AUD to continue to decline to 0.6560, possibly 0.6520, UOB Group’s FX analysts Quek Ser Leang and Lee Sue Ann note.
AUD can slide towards 0.6520
24-HOUR VIEW: “We expected AUD to ‘decline further’ yesterday. We pointed out that ‘the significant support level at 0.6585 might not be easy to break.’ However, AUD broke below 0.6585, reaching a low of 0.6580. AUD closed on a soft note at 0.6583 (-0.33%). While oversold, the decline could extend to 0.6560 before stabilisation can be expected. A sustained break below 0.6560 is unlikely today. Resistance is at 0.6600; a breach of 0.6615 would mean that the weakness has stabilised.”
1-3 WEEKS VIEW: “In our most recent narrative from last Thursday (24 Oct, spot at 0.6635), we highlighted that AUD ‘is expected to continue to decline, and the level to watch is a significant support at 0.6585.’ Yesterday (Monday), AUD broke below 0.6585 (low has been 0.6580). While oversold, the weakness is not showing signs of stabilisation just yet. Only a breach of 0.6640 (‘strong resistance’ previously at 0.6670) would mean that the weakness that started early this month (as annotated in the chart below) has stabilised. Until then, there is potential for AUD to continue to decline to 0.6560, possibly 0.6525.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
