In the view of Markets Strategist at UOB Group Quek Ser Leang and Senior FX Strategist Peter Chia see NZD/USD navigating between 0.6105 and 0.6265 in the next few weeks.
24-hour view: “We highlighted yesterday that ‘the bias for NZD still appears to be on the upside but a clear break of 0.6275 is unlikely’. While our view was not wrong as NZD rose to a high of 0.6265, we did not anticipate the sharp drop from the high (NZD dropped to 0.6173 in NY before extending its decline in early Asian trade). Downward momentum has improved, albeit not much. Today, NZD could decline but a sustained drop below 0.6145 is unlikely (the next support at 0.6100 is unlikely to come into view). Resistance is at 0.6200, followed by 0.6230.”
Next 1-3 weeks: “In our most recent narrative from Tuesday (14 Mar, spot at 0.6220), we highlighted that ‘upward momentum has improved, albeit not much’. We added, NZD has to break clearly above 0.6275 before a sustained advance is likely. Yesterday, NZD rose to 0.6265 before dropping sharply. The buildup of momentum has fizzled out. From here, NZD is likely to trade in a range, expected to be between 0.6100 and 0.6265.”