NZD/USD seen within 0.6000/0.6130 range – UOB

NZD/USD keeps the neutral stance unaltered so far and is expected to navigate within the 0.6000/0.6130 in the next weeks, noted FX Strategists at UOB Group.

Key Quotes

24-hour view: “Our view for NZD to ‘test last month’s peak at 0.6176 first before easing’ was wrong as it plummeted by -1.11% (from a high of 0.6157) and closed at 0.6071. The rapid decline is running ahead of itself and further sustained decline is unlikely. That said, there is room for NZD to edge lower but any weakness is viewed as part of a 0.6030/0.6090 range (a sustained below 0.6030 is not expected).”

Next 1-3 weeks: “While we a held a positive view on NZD, we highlighted last Friday (08 May, spot at 0.6115) that NZD ‘has to post a daily closing above 0.6176 before further gains can be expected’. However, the 0.6176 level remains intact as NZD plummeted after touching a high of 0.6157 yesterday (11 May). Upward pressure has eased and NZD has likely moved into a consolidation phase. From here, NZD is likely to trade within a 0.6000/0.6130 range for the next several days. Looking ahead, there is no early indication on which side of the range is more vulnerable.”