NZD/USD: Outlook remains fragile – UOB
|In opinion of FX Strategists at UOB Group, NZD/USD could edge lower and retest the 0.6800 neighbourhood in the short-term horizon.
Key Quotes
24-hour view: “We highlighted yesterday that ‘while NZD could drop below the overnight low of 0.6900, it is unlikely able to break the next support at 0.6870’. However, NZD dropped briefly to 0.6868, rebounded to 0.6951 before dropping back down to close at 0.6885 (-0.52%). While oversold, the weakness in NZD has not stabilized and it could edge lower to 0.6840. In view of the oversold conditions, a sustained decline below this level is unlikely (next support is at 0.6800). Resistance is at 0.6900 followed by 0.6920.”
Next 1-3 weeks: “Yesterday, we highlighted that ‘further weakness is not ruled out but NZD is unlikely able to maintain the pace of the current decline’. We added, ‘the next support below 0.6900 is at 0.6870 followed by 0.6840’. While our view for a weaker NZD was not wrong, we did not anticipate the price actions where NZD dropped briefly below 0.6870 (low of 0.6868), rebounded to 0.6951 before dropping back down. From here, there is no change to the weak outlook and a break of 0.6840 would shift the focus to 0.6800. On the upside, a breach of 0.6960 (‘strong resistance’ level was at 0.7000 yesterday) would indicate that the downward pressure has eased.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.