AUD/USD to see another leg lower on a close below 0.7350/60 – Westpac

AUD/USD stays capped at 0.7400. The aussie retains downside potential on the day and could see further falls on a close below the 0.7350/60 support zone, economists at Westpac report.

AUD/USD is prone to setbacks, potentially as far as 0.7200/50

“Price action post the RBA’s ‘dovish taper’ has clearly emphasised that with the vast bulk of mining dividend FX conversion behind us, further gains are going to be difficult.”

“Optimism that by October/November, Australia’s catch-up on vaccination should be starting to result in eased restrictions and thus scope for the economy to rebound remains a positive.”

“AUD/USD is likely to be prone to setbacks this month, potentially as far as 0.7200/50 which would be a buying opportunity.”

“Near-term support at 0.7350/60 will be important and a close below those levels would point to further short -term weakness.”