UOB Group’s FX Strategists noted the outlook for NZD/USD stays positive in the short-term, with the focus shifting to 0.7310.
24-hour view: “Yesterday, we highlighted that ‘the bias is tilted to the downside but any weakness is unlikely to break the strong support at 0.7165’. NZD subsequently dipped to 0.7189 but during NY session, it rallied sharply to 0.7267 (before extending its advance in early Asian hours). NZD could continue to strengthen but overbought conditions suggest that 0.7310 is likely out of reach (minor resistance is at 0.7295). Support is at 0.7255 followed by 0.7230.”
Next 1-3 weeks: “We turned positive on NZD earlier this week. In our latest narrative from Tuesday (27 Apr, spot at 0.7225), we noted that ‘0.7270 may not come into the picture so soon’. NZD rallied strongly overnight and moved above 0.7270 during Asian hours. Upward momentum has improved, albeit not by all that much. The next level to focus on is at 0.7310. The current positive phase is deemed intact as long as NZD does not move below 0.7205 (‘strong support’ level was previously at 0.7165).”
