According to UOB Group’s Senior FX Strategist Peter Chia and Markets Strategist Quek Ser Leang, NZD/USD’s selling bias may be reduced once it breaks above the 0.5985 mark.
daily perspectiveSince “momentum indicators are flat” as of yesterday, we anticipated quiet trading of the NZD between 0.5905 and 0.5945. After then, the NZD fluctuated between 0.5897 and 0.5934 before closing essentially unchanged (0.5926, +0.03%). NZD may trade in a range today, most likely between 0.5900 and 0.5945.
Within the next three weeks: We maintain the same outlook as yesterday (21 August, spot at 0.5925), according to which the recent NZD decline appears to be easing. However, the NZD’s weakness wouldn’t be stabilised until a break of 0.5985 (a level that is considered to be strong resistance). However, any additional decline is expected to happen gradually, and 0.5870 should provide strong resistance.