NZD/USD: Likely to consolidate between 0.5985 and 0.6030 – UOB Group

New Zealand Dollar (NZD) is likely to consolidate between 0.5985 and 0.6030. In the longer run, rapid buildup in upward momentum indicates further NZD strength; the level to monitor is 0.6095, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Rapid buildup in upward momentum indicates further NZD strength

24-HOUR VIEW: "Following the rally in NZD to 0.6043 two days ago, we stated yesterday that 'while deeply overbought, the rally in NZD could extend to 0.6070 before a pause can be expected.' However, after rising to 0.6054, NZD pulled back to 0.5988 before settling at 0.6000 (-0.65%). NZD appears to have entered a consolidation phase, and today, we expect it to trade between 0.5985 and 0.6030."

1-3 WEEKS VIEW: "We revised our NZD outlook to positive yesterday (03 Jun, spot at 0.6040). We indicated the following: 'The rapid buildup in momentum indicates further NZD strength. The level to monitor is 0.6095. We will maintain our view of a stronger NZD as long as 0.5970 is not breached.' While upward momentum has slowed somewhat with the subsequent pullback to 0.5988, only a breach of 0.5970 would indicate that our view was incorrect."