AUD/USD: Upside momentum keeps building up – UOB

AUD/USD needs to clear 0.7860 to allow for a sustained advance in the short-term horizon, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “Our expectation for AUD to ‘trade sideways’ was incorrect as it rose to 0.7805 before easing off. Despite the relatively strong advance, upward momentum has not improved by much. However, there is room for AUD to move higher but a clear break of the solid resistance at 0.7820 is unlikely (0.7805 is acting as a minor resistance). Support is at 0.7755 followed by 0.7730.”

Next 1-3 weeks: “There is not much to add to our update from yesterday (13 Jan, spot at 0.7765). As highlighted, while upward momentum is building up, it appears tentative for now and AUD has to close above 0.7820 before a sustained advance can be expected. At this stage, the prospect for AUD to move clearly above 0.7820 is not high but it would remain intact as long as AUD does not move below 0.7680 (‘strong support’ level).”