In light of the recent price action, AUD/USD could now revisit the 0.7040 region in the next weeks, comment FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang. Key Quotes 24-hour view: “The strong surge in AUD to 0.7012 during NY session appears to be overdone and AUD is unlikely to strengthen much further. For today, AUD is more likely to trade between 0.6965 and 0.7020.” Next 1-3 weeks: “Despite the relatively strong advance in AUD yesterday, upward momentum has not improved by much. That said, there is scope for AUD to advance further to 0.7040. At this stage, the odds for AUD to rise to the next resistance at 0.7070 are not high. On the downside, a breach of 0.6935 (‘strong support’ level) would indicate that the current upward pressure has eased.”

 According to the latest Reuters poll of analysts and fund managers, the bearish outlook on most Asian currencies has eased but short positions remain at around multi-month highs.

Key findings

“Short bets on the Thai baht were the highest since January 2018, having steadily built up since early March.”

“Sentiment for the Philippine peso improved over the past two weeks after the Bangko Sentral ng Pilipinas in mid-July raised its key interest rates by 75 bps in an off-cycle move.”

“Chinese yuan seen as a safer bet among Asian currencies, was the second-least shorted currency in the region, while short positions on the Indian rupee, Indonesian rupiah and the Malaysian ringgit moderated slightly but remained firm.”

• USD/INR Price Analysis: Indian rupee buyers need validation from 79.70