Expected to continue to trade between 0.5590 and 0.5640 – UOB Group

New Zealand Dollar (NZD) is expected to continue to trade in a range vs US Dollar (USD), most likely between 0.5590 and 0.5640. In the longer run, room for NZD to continue to weaken; it remains to be seen if 0.5565 is within reach, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Room for NZD to continue to weaken

24-HOUR VIEW: “Last Friday, NZD fell to a low of 0.5587. Yesterday, Monday, when it was at 0.5605, we pointed out that ‘Conditions remain deeply oversold; this, combined with slowing momentum, suggests that instead of weakening further, NZD is more likely to trade in a 0.5585/0.5630 range.’ NZD then traded between 0.5594 and 0.5641, closing at 0.5617 (+0.32%). The price movements did not result in any increase in either downward or upward momentum. Today, we continue to expect range trading, most likely between 0.5590 and 0.5640.”

1-3 WEEKS VIEW: “There is not much to add to our update from yesterday (03 Mar, spot at 0.5605). As highlighted, while we continue to see room for NZD to weaken, it remains to be seen if the next support level at 0.5565 is within reach. On the upside, a breach of 0.5670 (no change in ‘strong resistance’ level from yesterday) would indicate that the NZD weakness from late last week has ended.”