In view of FX Strategists at UOB Group, NZD/USD could drop further on a breakdown of the 0.6300 handle.
24-hour view: “NZD traded sideways for most of yesterday but dropped sharply during NY hours and tested the strong support at 0.6300 (low of 0.6300). While the underlying tone is weak, 0.6300 remains as a strong support. Overall, a dip below 0.6300 is not ruled out but any weakness is viewed as a lower trading range of 0.6295/0.6345 (a sustained decline below 0.6295 is not expected).
Next 1-3 weeks: “While our view from Monday (16 Sep, spot at 0.6380) that “a short-term top is in place” was not wrong, the price action since then has weaker than anticipated. From here, if NZD were to register a NY close below 0.6300, it would increase the risk of a break of September’s 0.6270 low (next support is at 0.6230). The prospect for such a move is not that high for now but would increase quickly unless NZD can move and stay above 0.6360 within these 1 to 2 days”.
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.