NZD/USD: Dwindling bets for a move to 0.7025 – UOB

FX Strategists at UOB Group noted a potential move to 0.7025 in NZD/USD appears to be losing momentum.

Key Quotes

24-hour view: “We highlighted last Friday that ‘momentum indicators are turning flat’ and we expected NZD to ‘trade sideways within a range of 0.6940/0.6990’. NZD subsequently traded sideways albeit within a narrower range than expected (0.6946/0.6986). Further sideway trading seems likely, expected to be within a range of 0.6940/0.6985.”

Next 1-3 weeks: “We have expected a stronger NZD for more than a week now. In our latest narrative from last Wednesday (23 Mar, spot at 0.6960), we highlighted that while NZD strength is still intact, any further advance is expected to face solid resistance at 0.7025. Since then, NZD has not been able to make much headway on the upside. Upward momentum is beginning to wane and the odds for NZD to advance to 0.7025 have diminished. A break of 0.6925 (‘strong support’ level was at 0.6910 last Friday) would indicate that the current NZD strength has run its course.”