NZD/USD bullish above 0.7435/40 – UOB

FX Strategists at UOB Group noted the pair’s outlook should shift to bullish on a daily close above 0.7435/40 band.

Key Quotes

24-hour view: “NZD registered a range of 0.7353/0.7409 yesterday, relatively close to our expected 0.7355/0.7420 sideway trading range. The undertone has weakened somewhat but any decline from here is viewed as part of a lower 0.7340/0.7400 consolidation and not the start of sustained down-move”.

Next 1-3 weeks: “The strong surge that started in the middle of last week tested the January’s peak of 0.7437 last Friday but failed to break through (exact high of 0.7437 on Friday). While upward momentum has improved considerably, only a NY closing above 0.7435/40 would indicate that a move towards 0.7500 (and possibly beyond) has started. The odds for such a move are not high at this stage but would continue to improve as long as the key 0.7310 support is not taken out in the next few days”.