NZD/USD: Unlikely to reach 0.5970 - UOB Group

New Zealand Dollar (NZD) could weaken further against US Dollar (USD), but it is unlikely to reach 0.5970; note that there is another support level at 0.5995. In the longer run, upward pressure has faded; NZD is likely to trade in a range of 0.5970/0.6080 for now, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Upward pressure has faded

24-HOUR VIEW: "When NZD was at 0.6035 yesterday, we held the view that it 'is likely to trade in a sideways range of 0.6015/0.6055.' We underestimated the volatility as after dipping to 0.6008, NZD soared to 0.6071. NZD closed 0.70% higher at 0.6069 in NY, but it fell sharply in early Asian trade today. The rapid increase in downward momentum suggests NZD could weaken further, even though it is unlikely to reach the major support at 0.5970. Note that there is another support level at 0.5995. On the upside, resistance levels are at 0.6050 and 0.6070."

1-3 WEEKS VIEW: "We have maintained the same view since last Friday (06 Jun, spot at 0.6045), in which we indicated that 'upward momentum remains largely unchanged, but there is a chance for NZD to test 0.6095.' Yesterday, NZD dipped below our 'strong support' level of 0.6010. Upward pressure has faded, and instead of testing 0.6095, NZD is likely to trade in a range of 0.5970/0.6080 for now."