UOB Group’s FX Strategists noted the upside bias could push NZD/USD higher, although the 0.6840 level emerges as a tough barrier in the near term.

Key Quotes

24-hour view: “We expected NZD to ‘trade sideways within a range of 0.6730/0.6785’ yesterday. However, instead of trading sideways, NZD rose to a high of 0.6798. Despite the advance, upward momentum has barely improved and NZD is unlikely to rise much further. For today, NZD is more likely to consolidate and trade within a range of 0.6745/0.6800.”

Next 1-3 weeks: “We highlighted on Tuesday (01 Mar, spot at 0.6765) that upward momentum is beginning to build and NZD is likely to head higher. We added, ‘0.6810 is a solid resistance level and may not be easy to break’. While NZD subsequently rose to a high of 0.6798 during NY session, upward momentum has barely improved. However, further NZD strength is not ruled out but the next major resistance at 0.6840 is unlikely to come under threat. On the downside, a breach of 0.6720 (‘strong support’ level was at 0.6690 yesterday) would indicate that the current mild upward pressure has eased.”