United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann reported that the Australian Dollar (AUD) outperformed on Monday, closing near 0.6970 after a modest rebound against the US Dollar. The AUD/USD pair closed 0.30% higher at 0.6972, trading within a range of 0.6933 to 0.6974 during the session. UOB analysts noted that while there was a tentative increase in upward momentum, it was not sufficient to signal a sustained advance, and they expect the pair to remain capped below 0.6985 in the near term.
For the next 1–3 weeks, UOB maintains that the downward momentum for AUD/USD is slowing, largely due to deeply oversold conditions. They indicated that a break above the 0.6985 resistance level would suggest that the previously targeted support at 0.6866 is unlikely to be reached. However, the strategists emphasized that medium-term risks for the Australian Dollar remain skewed to the downside.
In their short-term outlook, UOB expects the AUD to edge higher but remain within a 0.6945 to 0.6985 range, reiterating that a clear break above 0.6985 is unlikely at this stage. The analysts also highlighted that while the weakness in the AUD that began in the middle of the previous month persists, oversold conditions may limit further losses in the immediate term [1].
CONCLUSION
The Australian Dollar experienced a modest rebound, supported by oversold conditions, but UOB strategists caution that medium-term risks remain tilted lower. While a break above 0.6985 could signal a shift in momentum, the currency is expected to stay range-bound in the near term. Market impact is assessed as low, with no significant breakout anticipated.