New Zealand Dollar (NZD) could edge higher against US Dollar (USD) but is unlikely to be able to break above 0.5930. In the longer run, NZD is expected to range trade, most likely between 0.5860 and 0.5960, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
NZD is expected to range trade
24-HOUR VIEW: “Yesterday, we expected NZD to ‘trade in a range between 0.5895 and 0.5930.’ However, NZD traded in a lower range of 0.5884/0.5922. Despite the range-bound price action, there has been a slight increase in upward momentum. Today, NZD could edge higher, but any advance is unlikely to break above 0.5930. The strong resistance at 0.5945 is unlikely to come under threat. Support levels are at 0.5895 and 0.5880.”
1-3 WEEKS VIEW: “After holding a negative NZD view since early last week, we indicated on Monday (04 Aug, spot at 0.5910) that ‘while our ‘strong resistance’ level at 0.5960 has not been breached yet, the slowdown in momentum indicates that the odds of NZD reaching 0.5845 are low.’ NZD traded in a quiet manner over the past couple of days, and while our ‘strong resistance’ level has not been breached yet, downward momentum has largely faded. We are revising our view to neutral, and now expect NZD to range trade, most likely between 0.5860 and 0.5960.”
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