Further decline in NZD/USD is forecast to meet tough support in the 0.6700 area in the short-term horizon, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “Yesterday, we held the view that ‘the bias is tilted to the upside’. Our expectations did not materialize as NZD traded sideways between 0.6737 and 0.6782. Further sideway-trading would not be surprising, likely between 0.6735 and 0.6785.”

Next 1-3 weeks: “Last Friday (07 Jan, spot at 0.6745), we highlighted that downward momentum is beginning to improve but any weakness in NZD is expected to face solid support at 0.6700. Since then, NZD has not been able to make any headway on the downside. There is no change in our view for now and only a breach of 0.6805 (no change in ‘strong resistance’ level) would indicate that the build-up in momentum has fizzled out.”