NZD/USD stays focused on 0.6380 – UOB

FX Strategists at UOB Group noted NZD/USD could weaken to 0.6380 ahead of 0630 in the next weeks.

Key Quotes

24-hour view: “We highlighted yesterday that we ‘continue to detect a soft underlying tone but for today, this would likely translate into a lower trading range of 0.6390/0.6445’. NZD subsequently traded within a narrower range than anticipated (between 0.6405 and 0.6442). Indicators are mostly flat and NZD could continue to trade sideways for now, likely between 0.6400 and 0.6450.”

Next 1-3 weeks: “There is not much to add to our latest narrative from last Thursday (25 Jun. spot at 0.6420). As highlighted, if NZD closes below 0.6380, it could weaken further to 0.6320. The prospect for such a move has ticked up but is still not high. Overall, only a break of 0.6480 (‘strong resistance’ level previously at 0.6510) would indicate the downside risk has dissipated.”