24-hour view: Our view for AUD to trade sideways in a range of 0.6380/0.6430 yesterday was incorrect. Instead of trading in a range, AUD rose to 0.6455 before pulling back. Despite the advance to 0.6455, there is no clear increase in upward momentum, and we do not expect AUD to rise further. Today, we continue to expect AUD to trade in a range, likely between 0.6400 and 0.6450. 

Next 1-3 weeks: We continue to hold the same view as from Monday (21 Aug, spot at 0.6420). As highlighted, while the AUD weakness that started late last month is still intact, short-term conditions are severely oversold, and the pace of any further weakness is likely to be slow. In order for AUD to weaken further, it must break and stay below last week’s low of 0.6365. The chance of AUD breaking clearly below 0.6365 will remain intact as long as it stays below 0.6480 (no change in ‘strong resistance’ level). Looking ahead, the next support below 0.6365 is at 0.6320.