NZD/USD: Extra gains now target 0.6720 – UOB

NZD/USD faces a potential move to the 0.6720 in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We expected NZD to strengthen yesterday but we were of the view that ‘any advance is unlikely to break 0.6685’. The subsequent advance exceeded our expectations as NZD soared to 0.6698. The rapid rise appears to be overdone and NZD is unlikely to advance further. For today, NZD is more likely to trade sideways, expected to be between 0.6650 and 0.6700.”

Next 1-3 weeks: “We have held the same view since Monday (07 Feb, spot at 0.6605) where NZD is in a consolidation and is likely to trade between 0.6545 and 0.6685. After trading sideways for a few days, NZD rose above the top of the expected range (high of 0.6698 during NY session). Upward momentum is beginning to build and NZD is likely to trade with an upward bias towards 0.6720. The upward bias is intact as long as NZD does not drop below the ‘strong support’ level, currently at 0.6620.”