In the opinion of Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group, further range bound trade in NZD/USD appears likely in the near term.

Key Quotes

24-hour view: “We expected NZD to trade in a range between 0.6185 and 0.6235 yesterday. NZD traded in a range of 0.6174/0.6225 before closing at 0.6200 (-0.10%). NZD dropped sharply in early Asian trade and downward momentum is building. While NZD is likely to weaken, a sustained drop below the major support at 0.6140 is unlikely. Resistance is at 0.6200, followed by 0.6225.”

Next 1-3 weeks: “Our latest narrative was from Monday (17 Apr, spot at 0.6210) when we highlighted that the recent choppy swings have resulted in a mixed outlook and NZD could trade in a range of 0.6140/0.6285 for now. We continue to hold the same view but downward momentum appears to be building, albeit tentatively. Looking ahead, NZD has to break and stay below 0.6120 before a sustained decline is likely.”