FX Strategists at UOB Group believe further upside in the Kiwi Dollar seems to have lost some momentum for the time being.
24-hour view: “We highlighted yesterday the soft undertone could lead to “a move lower towards 0.7320 but a clear break is not expected”. NZD dropped to a low of 0.7334 before rebounding quickly. The mild downward pressure has eased and the current movement is viewed as part of consolidation phase. In other words, we expect NZD to trade sideways for now, likely within a 0.7345/0.7390 range”.
Next 1-3 weeks: “NZD eked out a ‘fresh high’ of 0.7395 last Friday before reversing most of its gain and closed lower for the day. Upward pressure has been dented but as long as 0.7320 is not clearly taken out, there is still room for another attempt to move towards the year-to-date high of 0.7435/40 even though the odds for such a move have diminished considerably”.
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