Extra consolidation likely in NZD/USD – UOB

According to FX Strategists at UOB Group, NZD/USD is still expected to navigate within 0.6740 and 0.6870 in the near term.

Key Quotes

24-hour view: “We highlighted yesterday that ‘the decline in NZD has room to extend but oversold conditions suggest that the chance of a break of 0.6775 is not high’. Our expectations did not quite materialize as NZD traded sideways between 0.6788 and 0.6818. The underlying tone still appears to be a tad soft and we continue to see chance for NZD to drift lower. That said, a break of 0.6775 is unlikely. Resistance is at 0.6810 followed by 0.6820.”

Next 1-3 weeks: “There is no change in our view from yesterday (17 Jan, spot at 0.6810). As highlighted, the recent sharp and rapid loss in momentum has resulted in a mixed outlook and NZD is likely to trade between 0.6740 and 0.6870 for now.”