In opinion of FX Strategists at UOB Group, further upside in NZD/USD is likely while above 0.6840 for the time being.

Key Quotes

24-hour view: “We highlighted yesterday that NZD ‘could rise to 0.6925 but a sustained advance above this level is unlikely’. NZD subsequently rose to 0.6922 before easing off. Upward momentum has waned somewhat and this coupled with overbought conditions suggests NZD is unlikely to advance further. From here, there is a slight downward bias but any weakness is viewed as part of a lower trading range of 0.6855/0.6910. In other words, a clear break of 0.6855 is unlikely.”

Next 1-3 weeks: “Last Friday (18 Mar, spot at 0.6895), we highlighted that further NZD strength is likely and a break of 0.6925 would shift the focus to 0.6950. Yesterday (21 Mar, spot 0.6905), NZD rose to 0.6922 before pulling back. Shorter-term upward momentum has waned somewhat but only a breach of 0.6840 (no change in ‘strong support’ level) would indicate that NZD is not ready to rise above 0.6925.”