NZD/USD: Slight Increase in Downward Momentum – UOB Group
Slight increase in downward momentum is likely to lead to a lower range of 0.5685/0.5730 instead of a sustained decline. In the longer run, there has been no further increase in upward momentum; a break of 0.5660 would mean that the recovery is not reaching 0.5775, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Likely to Trade to a Lower Range of 0.5685/0.5730
24-HOUR VIEW: We highlighted last Friday that 'further range trading seems likely, probably in a range of 0.5710/0.5760.' NZD then traded in a lower range than expected (0.5695/0.5741). There has been a slight increase in downward momentum, but this is likely to lead to a lower range of 0.5685/0.5730 instead of a sustained decline.
1-3 WEEKS VIEW: Last Thursday (06 Mar, spot at 0.5720), we highlighted that the 'current price movements are likely part of a recovery phase that could reach 0.5775.' NZD subsequently rose to 0.5760 and then pulled back. There has been no further increase in momentum and should NZD break below 0.5660 (no change in ‘strong support’ level from last Friday), it would mean that 0.5775 is out of reach this time round.
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