NZD/USD could advance further and re-test the 0.6690 zone in the next weeks, according to FX Strategists at UOB Group.
24-hour view: “Yesterday, we highlighted that ‘momentum remains strong and NZD could advance further towards 0.6665’. We added, ‘the rapid rise is already overbought and the next resistance at 0.6690 could be just out of reach for now’. Our view was not wrong as NZD popped briefly to a high of 0.6675. Momentum has eased and the current movement is viewed as part of a consolidation phase. In other words, NZD is expected to trade sideways, likely not straying much out of yesterday’s 0.6600/0.6675 range.”
Next 1-3 weeks: “After trading in a relatively quiet manner for several days, NZD popped to a high of 0.6625 before extending its gains this morning. The sudden surge in momentum could lead to further NZD strength towards 0.6690. For now, the probability for a sustained advance above this level is not high. Note that last month’s top near 0.6715 is another solid resistance. Overall, NZD is expected to trade on a firm note as long as it does not move below the ‘strong support’ level at 0.6545 within these few days.”
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