According to United Overseas Bank (UOB) analysts Quek Ser Leang and Lee Sue Ann, the Australian Dollar (AUD) experienced a sharp decline to 0.6883 against the US Dollar (USD) before staging a modest recovery to close at 0.6901, representing a 0.21% drop [1]. The analysts note that the AUD is in deeply oversold territory, which could lead to near-term range trading between 0.6880 and 0.6920 [1]. Despite the oversold conditions, UOB maintains that there is still scope for further weakness in the AUD over the next one to three weeks, though it remains uncertain if the key support level at 0.6835 will be tested during this downswing [1].
In their 24-hour outlook, UOB highlights that while the recent selloff appears overdone, there are no clear signs of stabilization yet. They suggest that as long as the AUD does not breach the 0.6960 resistance level (with minor resistance at 0.6935), it could drop below 0.6900, but is unlikely to sustain levels below this mark due to the oversold conditions [1].
For the 1-3 week horizon, UOB reiterates that only a move above 0.6960 would indicate that the decline, which began last Friday, is stabilizing. Until then, the risk of further downside remains, with the major weekly support at 0.6835 being a key level to watch [1].
No specific market reactions or analyst opinions beyond UOB's technical outlook are mentioned in the article [1].
CONCLUSION
UOB analysts see the Australian Dollar as deeply oversold but still vulnerable to further declines against the US Dollar. Key levels to watch are the 0.6880–0.6920 range in the near term and the 0.6835 support in the coming weeks. Only a break above 0.6960 would signal potential stabilization.