In light of the recent price action in NZD/USD, FX Strategists at UOB Group still do not see a sustainable recovery in the pair.
Key Quotes
24-hour view: “Our expectation for “further NZD weakness towards 0.6270” was incorrect as it staged a surprisingly robust rebound to 0.6335. The price action suggests yesterday’s 0.6284 low could be a short-term bottom. That said, it is too soon to expect a significant rebound. For today, NZD is more likely to trade sideways, expected to be within a 0.6285/0.9335 range.”
Next 1-3 weeks: “NZD popped above our ‘strong resistance’ level of 0.6330 yesterday (high of 0.6335). While downward momentum has eased, it is too early to expect a sustained recovery. From here, NZD is expected to trade sideways between 0.6270 and 0.6350. Looking forward, if NZD were to register a NY closing below 0.6270, it would indicate the next down-leg in NZD towards 0.6240 (and possibly lower) has started.”
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