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In opinion of FX Strategists at UOB Group, NZD/USD could accelerate its march north on a break below the 0.62 area.

Key Quotes

24-hour view: “Instead of “drifting lower to 0.6235″, NZD dropped briefly to 0.6207 before rebounding strongly. The volatile price action has resulted in a mixed outlook. For today, NZD could continue to trade in a choppy manner but yesterday’s 0.6204/0.6271 range is likely enough to contain the movement for now”.

Next 1-3 weeks: “While we detected the weakened underlying tone yesterday (01 Oct, 0.6260) and indicated that NZD “could drift lower”, we held the view that “odds for a move to 0.6200 are not high”. NZD subsequently plummeted to 0.6204 before rebounding strongly. The underlying tone has deteriorated but oversold conditions suggest that further weakness is likely only if NZD were to register a NY close below 0.6200. Meanwhile, NZD could trade between 0.6200 and 0.6300 for a few days”.