According to Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group, NZD/USD no faces a probable advance to the 0.6575 level in the near term.

Key Quotes

24-hour view: “We highlighted yesterday that ‘the bias for NZD is still on the downside even though the major support at 0.6400 is still unlikely to come into view’. NZD subsequently dropped to a low of 0.6417, surged quickly to 0.6508 before extending its advance in early Asian trade. Strong upward momentum is likely to lead to further NZD strength even though the major resistance at 0.6575 is unlikely to come under threat today. Support is at 0.6495, followed by 0.6470.”

Next 1-3 weeks: “Our most recent narrative from was from a week ago (26 Jan, spot at 0.6492) where NZD ‘is likely to trade between 0.6400 and 0.6535 for the time being’. NZD soared in NY trade and it is currently approaching 0.6535. The rapid increase in upward momentum suggests the consolidation phase has ended. NZD is likely to head higher toward 0.6575. Overall, only a breach of 0.6445 (‘support level’) would indicate that NZD is not ready to head higher.”