New Zealand Dollar (NZD) could rise above 0.5735; any further advance is unlikely to reach 0.5755. In the longer run, the price action suggests NZD is likely to advance further; the levels to watch are 0.5735 and 0.5755, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
NZD is likely to advance further
24-HOUR VIEW: “NZD surged to a high of 0.5702 two days ago. Yesterday, we highlighted that ‘there is a chance for NZD to rise to 0.5735’. However, we were of the view that ‘given the deeply overbought conditions, a sustained rise above this level is unlikely’. NZD subsequently rose to a high of 0.5732. Although upward momentum has not increased much, NZD could rise above 0.5735 today. Based on the current momentum, any further advance is unlikely to reach the next resistance at 0.5755. Support levels are at 0.5710 and 0.5695.”
1-3 WEEKS VIEW: “We revised our view on NZD to positive two days ago (26 Nov, spot at 0.5660). We highlighted that ‘the rapid increase in short-term upward momentum could lead to NZD testing 0.5690’. After NZD subsequently soared to 0.5702, we highlighted yesterday (27 Nov, spot at 0.5700) that ‘the price action suggests NZD is likely to advance further, and the levels to watch are 0.5735 and 0.5755’. We pointed out that ‘to keep the momentum going, NZD must not break below 0.5640 (‘strong support’ level)’. We maintain the same view, but the ‘strong support’ level is now at 0.5665 instead of 0.5640.”
