UOB strategists Quek Ser Leang and Lee Sue Ann note AUD/USD slipped to 0.6943 after previously expecting modest upside, but the move has not generated strong bearish momentum. Intraday, the Australian Dollar (AUD) is seen consolidating between 0.6935 and 0.6975. On a one to three week view, they have shifted to a neutral stance, looking for range trading between 0.6935 and 0.7020 despite longer-term downside risks.

Aussie Dollar trapped in consolidation band

"24-HOUR VIEW: Yesterday, we held the view that AUD “could edge higher within a 0.6965/0.6995 range.” We did not expect AUD to drop to a low of 0.6943. Despite the relatively rapid decline, there has been no clear increase in downward momentum, and a sustained decline in AUD is unlikely. Today, AUD is more likely to trade in a range between 0.6935 and 0.6975."

"1-3 WEEKS VIEW: We turned negative on AUD in the middle of last month. Yesterday (07 Oct, spot at 0.6980), we revised our view to neutral, and we indicated that AUD “is likely to trade between 0.6935 and 0.7020.” There is no change in our view."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.