UOB Group’s FX Strategists noted AUD/USD could extend its move higher in the next weeks, with a solid resistance just above 0.7400.

Key Quotes

24-hour view: “We highlighted yesterday that ‘there is room for the advance to test 0.7380 first before easing’. Our view was correct as AUD rose to 0.7384 before pulling back quickly. Upward pressure has eased and the current movement is viewed as part of a consolidation. In other words, AUD is likely to trade sideways for today, expected to be within a 0.7315/0.7370 range.”

Next 1-3 weeks: “There is not much to add to our update from yesterday (12 Oct, spot at 0.7345). As highlighted, upward momentum has improved and AUD could strengthen further even though the next major resistance at 0.7405 may not come into the picture so soon. On the downside, a break of the ‘strong support’ at 0.7290 (level was at 0.7275 yesterday) would indicate that the current upward pressure has eased.”