NZD/USD a break below 0.6800 not favoured near term – UOB

FX Strategists at UOB Group remain bearish on the Kiwi Dollar, although a breakout of the 0.6800 handle appears unlikely for the time being.

Key Quotes

24-hour view: “Instead of trading sideways as expected, NZD continues to drift lower and is currently approaching the strong 0.6820 support. A dip below this level would not be surprising but a sustained move below the next support at 0.6800 seems unlikely for now. Only a move back above 0.6885 would indicate that a short-term low is in place (minor resistance is at 0.6865)”.

Next 1-3 weeks: “While we have been bearish NZD, we assign low odds for extension to 0.6820. However, NZD is currently approaching this level and a break of this year-to-date low would shift the focus to 0.6750. Overall, only a move back above 0.6905 would indicate that the current bearish phase has ended”.