In the opinion of FX Strategists at UOB Group Quek Ser Leang and Peter Chia, AUD/USD could advance further and visit the 0.7170 region in the near term.

Key Quotes

24-hour view: “Last Friday, we highlighted that AUD ‘is unlikely to advance further’ and we expected it to ‘trade sideways within a range of 0.7060/0.7130’. Our view for sideway-trading was not wrong even though AUD traded within a narrower range than expected (0.7085/0.7128). Further sideway-trading would not be surprising, albeit likely within a higher range of 0.7095/0.7140.”

Next 1-3 weeks: “Our view from last Thursday (11 Aug, spot at 0.7080) still stands. As highlighted, AUD is likely to strengthen further and the level to monitor is at 0.7170. Overall, the current AUD strength is deemed intact as long as it does not move below 0.7035 (strong support’ level was at 0.7015 last Friday).”