In the opinion of FX Strategists at UOB Group Quek Ser Leang and Peter Chia, further gains in AUD/USD should meet the next hurdle at 0.6920.

Key Quotes

24-hour view: “Last Friday, we highlighted that AUD ‘is likely to edge higher but is not expected to break the strong resistance at 0.6800’. However, AUD took out 0.6800 and surged to 0.6877. Despite the subsequent pullback from the high, there appears to be enough momentum for AUD to advance from here. That said, the major resistance at 0.6920 is not expected to come under threat (there is another resistance at 0.6880). Support is at 0.6820 but only a breach of 0.6795 would indicate that AUD is unlikely to advance further.”

Next 1-3 weeks: “We did not expect the strong surge in AUD last Friday that took out our ‘strong resistance’ at 0.6800. The break of the ‘strong resistance’ has invalidated our view for AUD to weaken. The rapid boost in momentum has shifted the risk to the upside even though any advance is likely limited to a test of the major resistance at 0.6920. On the downside, a breach of 0.6760 (current ‘strong support’ level) would indicate that AUD is unlikely to rise towards 0.6920.”