NZD/USD: Extra advances remain in the pipeline – UOB

In the opinion of Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group, NZD/USD could still edge higher in the short term.

Key Quotes

24-hour view: NZD soared to a high of 0.6207 yesterday, but the advance was short-lived. The rapid pullback in overbought conditions suggests NZD is unlikely to advance further. Today, NZD is more likely to consolidate in a range of 0.6120/0.6185. 

Next 1-3 weeks: Yesterday, NZD soared to a 4-month high of 0.6207 before pulling back sharply. Further NZD strength appears likely, but it might not have enough momentum to break the formidable resistance at 0.6225 (this level is near the top of the weekly Ichimoku cloud). On the downside, if NZD breaks below the ‘strong support’ level (now at 0.6080), it would mean that it is not ready to break 0.6225