NZD/USD: Risks now shifted to the upside – UOB

NZD/USD could see its upside gather extra pace on a breakout of the 0.6410 level, comment UOB Group’s Economist Lee Sue Ann and Market Strategist Quek Ser Leang.

Key Quotes

24-hour view: “We expected NZD to ‘trade sideways between 0.6340 and 0.6405’ yesterday. NZD subsequently traded within a range of 0.6335/0.6381 before closing largely unchanged at 0.6367 (-0.05%). Flat momentum indicators suggest NZD could continue to trade sideways, likely between 0.6340 and 0.6405.”

Next 1-3 weeks: “On Monday (09 Jan, spot at 0.6350), we highlighted that while the risk for NZD has shifted to the upside, it must clear the major resistance at 0.6410 before further gains are likely. The upside risk will remain in place as long as NZD stays above 0.6320 (‘strong support’ level was at 0.6300 yesterday). Looking ahead, the next resistance level above 0.6410 is at 0.6445, followed by 0.6515.”