In the opinion of FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang, the downside pressure could motivate NZD/USD to slip back to 0.6975 ahead of 0.6945.

Key Quotes

24-hour view: “Yesterday, we were of the view that ‘the rapid drop in NZD could extend to 0.5975’. While NZD dropped as expected, it rebounded from a low of 0.5978. Downward pressure has eased and NZD is likely to trade sideways for today, expected to be within a range of 0.5985/0.6040.”

Next 1-3 weeks: “There is not much to add to our update from yesterday (14 Sep, spot at 0.6005). As indicated, while further NZD weakness is likely, any decline is likely to be at a slower pace. Supports are at 0.6975 and 0.6945. On the upside, a break of 0.6100 (no change in ‘strong resistance’ level from yesterday) would indicate that the weakness in NZD has stabilized.”