NZD/USD could advance further and test 0.6600 – UOB

Further upside momentum could lift NZD/USD to the 0.6600 region in the next weeks, noted FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.

Key Quotes

24-hour view: “We highlighted yesterday that ‘strong upward momentum is likely to lead to further NZD strength but expect strong resistance at 0.6570’. NZD subsequently rose to 0.6560. While upward momentum has not improved by much, NZD could advance further even though a sustained rise above 0.6570 is unlikely. For today, the major resistance at 0.6600 is not expected to come into the picture. Support is at 0.6535 followed by 0.6520.”

Next 1-3 weeks: “There is not much to add to our update from yesterday (30 May, spot at 0.6530). As highlighted, the recent price actions suggest NZD could strengthen further to 0.6600. Overall, only a breach of 0.6490 (‘strong support’ level was at 0.6470 yesterday) would indicate that the NZD strength that started early last week (see annotations in the chart below) has run its course.”