According to UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang, NZD/USD could extend the advance to the 0.6385 region in the near tem.
Key Quotes
24-Hour View: “Yesterday, we took the view that ‘there is scope for the NZD to rally above 0.6315 again before the risk of a more sustained pullback increases’. We indicated, ‘The next major resistance at 0.6385 is not expected to come under threat’. Our view was not wrong as the NZD rose to 0.6359 and then came back. A pullback in overbought conditions suggests that the NZD is unlikely to advance further. Today, NZD is more likely to trade sideways in the 0.6315/0.6360 range.”
Next 1-3 weeks: “We highlighted yesterday (May 08, spot at 0.6295) that the NZD is ‘likely to move further but it remains to be seen if it can break 0.6385 at this point’. NZD is higher at 0.6359 in NY trade before easing. Up. Overbought short-term conditions suggest NZD may consolidate for 1-2 days. Overall, unless 0.6265 (‘Strong Support’ level was at 0.6240 yesterday) is breached, NZD has a chance to rise to 0.6385. ‘Strong Support’ A breach would indicate that NZD strength ended last Wednesday (May 03, spot at 0.6215).”
