According to UOB strategists Lee Sue Ann and Quek Ser Leang, the AUD/USD currency pair experienced a sharp rebound from 0.6979 to 0.7101, leaving the pair overextended in the near term [1]. The strategists note that there is scope for the pair to push further toward 0.7120, but they question whether the momentum is strong enough to reach the next resistance level at 0.7155 [1].
In the short term, there has been a tentative build-up in upward momentum, and the AUD could edge higher. However, the strategists emphasize that for this upward momentum to be sustained, the AUD/USD must not break below the 'strong support' level at 0.7030 [1]. Immediate support levels are identified at 0.7085 and 0.7065 [1].
Despite the recent bounce, the broader technical outlook remains bearish. UOB highlights that a breach of the 0.6850/0.6870 support zone could trigger a further decline toward 0.6765 [1]. The analysis suggests that while a short-term bounce is possible, the overall trend for AUD/USD is still to the downside [1].
No specific market reactions or analyst opinions beyond the technical outlook are provided in the source [1].
CONCLUSION
The AUD/USD has rebounded sharply but faces significant resistance at 0.7155, with UOB strategists maintaining a bearish multi-week outlook. Sustaining upward momentum depends on holding above key support levels, while a break below 0.6850/0.6870 could lead to further declines. Market participants should remain cautious given the prevailing downside risks.