The outlook on NZD/USD remains bullish with the next target at the 0.6450 level, noted FX Strategists at UOB Group.
24-hour view: “We expected NZD to strengthen yesterday but held the view “0.6410 could be just out of reach”. The subsequent advance exceeded our expectation as NZD rose to 0.6416. While overbought, the current rally is not showing sign of weakness just yet. From here, NZD could continue to edge higher towards 0.6430. For today, last month’s 0.6450 peak is unlikely to be challenged. Support is at 0.6380 followed by 0.6360”.
Next 1-3 weeks: “The 0.6410 level that was first highlighted last Friday (18 Oct, spot at 0.6355) was exceeded as NZD rose to 0.6416. The price action was within our expectation as we indicated yesterday (21 Oct, spot at 0.6385) that “the solid price action suggests a move above 0.6410 would not be surprising” We added, “a break of 0.6410 would indicate NZD has enough momentum to challenge last month’s 0.6450 peak”. In other words, NZD remains strong and the focus has shifted to 0.6450. Looking ahead, if NZD were to register a NY closing above 0.6450, further sustained advance towards 0.6500 would not be surprising. On the downside, only a break of 0.6340 (‘strong support’ level was at 0.6310 yesterday) would indicate that the current upward pressure has eased”.