The rapid rise appears to be excessive, but there is a chance for Australian Dollar (AUD) to test 0.6595 before leveling off against US Dollar (USD). In the longer run, should AUD break clearly above 0.6595, it could trigger a further rise toward 0.6620, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Above 0.6595, AUD can rise toward 0.6620
24-HOUR VIEW: "Our view of sideways trading yesterday was incorrect, as AUD soared to 0.6583, closing on a strong note at 0.6582 (+0.74%). The rapid rise appears to be excessive, but there is a chance that AUD could test 0.6595 before leveling off. We do not expect 0.6620 to come into view today. Support is at 0.6560; a breach of 0.6540 would indicate that the current upward pressure has faded."
1-3 WEEKS VIEW: "Last Thursday, 26 Jun, when AUD was at 0.6520, we indicated that it 'could edge higher and test 0.6555.' After AUD rose, we highlighted on Friday (27 Jun, spot at 0.6550) that 'the price action suggests there is potential for AUD to test 0.6595, as long as 0.6495 (‘strong support’ level) is not breached.' Yesterday, AUD rose to 0.6583. From here, should AUD break clearly above 0.6595, it could trigger a further rise toward 0.6620. On the downside, the ‘strong support’ level is now at 0.6520 instead of 0.6495."
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