NZD/USD: Likely to consolidate in a range of 0.5705/0.5750 – UOB Group
|New Zealand Dollar (NZD) is likely to consolidate in a range of 0.5705/0.5750. In the longer run, the outlook for NZD is neutral now, and it is likely to trade in a range between 0.5685 and 0.5770, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Outlook for NZD is neutral now
24-HOUR VIEW: "Our view for NZD to 'trade in a range between 0.5700 and 0.5740' yesterday was incorrect, as it rose sharply, but briefly to a high of 0.5755 and then pulled back to close largely unchanged at 0.5725 (+0.05%). The current price movements are likely part of a consolidation phase. Today, we expect NZD to trade in a range of 0.5705 and 0.5750."
1-3 WEEKS VIEW: "Last Wednesday (08 Oct, spot at 0.5750), we indicated that 'the outlook for NZD has shifted to negative, and the level to watch is 0.5690.' After NZD fell to a low of 0.5685, we highlighted two days ago (15 Oct, spot at 0.5710) that 'while there has been no significant increase in downward momentum, there is a chance for NZD to test 0.5660 before the risk of a stronger recovery increases.' Yesterday, NZD rose and broke above our ‘strong resistance’ level of 0.5750 (high was 0.5755). Downward pressure has eased, and we are neutral on NZD now. For the time being, we expect it to trade in a range between 0.5685 and 0.5770."
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