In the opinion of Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia at UOB Group, NZD/USD could extend the decline once 0.6195 is cleared.

Key Quotes

24-hour view: “We highlighted yesterday that NZD ‘has likely moved into a consolidation phase’ and we expected it to trade between 0.6210 and 0.6260. NZD subsequently traded within a range of 0.6223/0.6263. The underlying tone has firmed somewhat and NZD is likely to edge higher to 0.6275 before the risk of pullback increases. The strong resistance at 0.6300 is unlikely to come under threat. Support is at 0.6235, a break of 0.6215 would indicate that the current mild upward pressure has faded.”

Next 1-3 weeks: “Our update from yesterday (20 Feb, spot at 0.6230) still stands. As highlighted, NZD has to break below 0.6195 within these 1-2 days or the chance for further weakness will diminish quickly. Conversely, a break of 0.6300 (no change in ‘strong resistance’ level) would indicate that the decline in NZD that started late last week has made a bottom at 0.6195.”