NZD/USD: Bulls are set to test 0.5930 – UOB Group
|The bias for the New Zealand Dollar (NZD) is tilted to the upside; it remains to be seen if any advance can break the strong resistance level at 0.5930, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.
The 0.5930 resistance is next to watch
24-HOUR VIEW: “After NZD dropped to 0.5859 two days ago and then rebounded, we indicated yesterday that ‘despite the decline, downward momentum has not increased much, and NZD is unlikely to weaken much further.’ We expected NZD to trade sideways between 0.5860 and 0.5900. NZD subsequently traded in a higher range of 0.5869/0.5905, closing on a firm note at 0.5903 (+0.47%). NZD is facing mild upward pressure, and the bias for today is tilted to the upside. However, it remains to be seen if any advance can break the strong resistance level at 0.5930 (there is another resistance at 0.5915). To keep the mild momentum going, NZD must not break below 0.5875 with minor support at 0.5885.”
1-3 WEEKS VIEW: “We turned negative in NZD two weeks ago. As we tracked the decline in NZD, in our most recent narrative from last Friday (26 Jul, spot at 0.5890), we indicated that ‘while further NZD weakness is not ruled out, severely oversold conditions suggest limited downside potential.’ We also indicated that ‘the next level to monitor is 0.5850.’ Two days ago, NZD dipped to 0.5859 and then rebounded. Downward momentum is slowing, this, combined with the still oversold conditions, suggests that the weakness in NZD is close to an end. However, only a breach of 0.5930 (no change in ‘strong resistance’ level) would indicate that NZD is not declining further.”
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