24-hour view: Last Friday, we held the view that “there is room for AUD to test the major support at 0.6595 before a more sustained rebound is likely.” Our view was incorrect as AUD soared to a high of 0.6701 in NY trade. The rapid rise appears to be overdone, and AUD is unlikely to advance much further. Today, AUD is more likely to trade sideways between 0.6660 and 0.6710. 

Next 1-3 weeks: After AUD dropped to 0.6599, we highlighted last Friday (07 Jul, spot at 0.6630) that “downward momentum is building tentatively”. We added, “AUD must break and stay below 0.6595 before a sustained decline is likely.” We did not anticipate the rapid rise in NY trade that sent AUD to a high of 0.6701. While our ‘strong resistance’ level of 0.6705 has not been breached yet, the tentative buildup of downward momentum has fizzled out. In other words, AUD is not ready to head lower. Instead, it is more likely to trade in a range between 0.6620 and 0.6750 for now.