Downward momentum is beginning to build; NZD is expected to weaken to 0.5770, UOB Group’s FX analyst Quek Ser Leang and Lee Sue Ann note.

NZD is expected to weaken to 0.5770

24-HOUR VIEW: When NZD was at 0.5820 yesterday, we indicated that NZD ‘could drop further, but it does not appear to have enough momentum to reach 0.5770 for now.’ The subsequent did not quite turn out as we expected, as after dropping to 0.5797, NZD soared to 0.5865. It then pulled back to close at 0.5835. The outlook for NZD is mixed after the choppy price action. Overall, it could trade in a range of 0.5805/0.5860.”

1-3 WEEKS VIEW: “We revised our NZD view to negative yesterday (26 Nov, spot at 0.5820), indicating that ‘downward momentum is beginning to build, and NZD is expected to weaken to 0.5770.’ We will maintain the same view provided that 0.5875 (no change in ‘strong resistance’ level) is not breached.”