The Australian dollar maintains its upward trajectory against the US dollar despite entering a consolidation phase, according to United Overseas Bank currency strategists Quek Ser Leang and Lee Sue Ann. Following last week’s sharp rally, the AUD/USD pair has settled into a narrow trading range between 0.7135 and 0.7170 as markets digest recent gains. The UOB analysts emphasize that this short-term sideways movement does not signal a reversal, with the broader bullish trend remaining firmly established. The bank has identified 0.7200 as the next key resistance level, suggesting further upside potential for the Aussie dollar once the current consolidation completes.
This assessment comes as traders evaluate Australia’s economic resilience and diverging monetary policy expectations between the Reserve Bank of Australia and the Federal Reserve. The consolidation phase may offer strategic entry points for those positioning for continued AUD strength.
FXnCO Insight
Traders should monitor the 0.7170 resistance level closely, as a decisive break above could trigger momentum buying toward the 0.7200 target in the near term.
Source: FXStreet