NZD/USD could trade between 0.6880 and 0.7010 in the next weeks, suggested FX Strategists at UOB Group.
Key Quotes
24-hour view: “We expected NZD to ‘trade sideways between 0.6920 and 0.6960’ yesterday. However, NZD rose to 0.6981 before easing off. The advance lacks momentum and NZD is unlikely to advance further. From here, NZD could edge lower to 0.6930, the next support at 0.6910 is unlikely to come under threat.”
Next 1-3 weeks: “We highlighted yesterday (04 Oct, spot at 0.6935) that ‘loss in momentum suggests that the prospect for NZD to weaken to 0.6807 has diminished’. NZD subsequently advanced 1 pip above our ‘strong resistance’ level at 0.6880 (high of 0.6881). While there is no clear break of the ‘strong resistance’, downward momentum has more or less dissipated and the weakness in NZD that started last week (see annotations in the chart below) has come to an end. The current movement is viewed as part of a consolidation and NZD is likely to trade within a 0.6880/0.7010 range for now.”
