UOB Group forex strategists noted that a sustainable move in the NZD / USD pair above 0.7010 remains off the beaten path for the time being.
Key statements:
24-hour outlook: “Yesterday, we observed that ‘despite the advance, the upside momentum remains lackluster’, but we are of the opinion that the NZD ‘could continue to advance higher.’ However, the NZD traded sideways between 0.6942 and 0.6977 before settle down with a weak tone 0.6948. Momentum indicators are turning neutral and the NZD is likely to trade both ways today, within a range of 0.6920 / 0.6965. “
Next 1-3 weeks: “On Wednesday (Aug 25, 0.6985), we indicated that there is room for the NZD’s rapid advance to extend, and a sustained rise above 0.7010 seems unlikely for now. The NZD yesterday broke its winning streak (August 26) when closing with a decrease of -0.37% (0.6948). We continue to hold the same opinion for now, but a break of 0.6900 (no change in “strong support” level) would indicate that the NZD is not ready to break above 0.7010 yet.”
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