As per UOB Group FX strategists Quek Ser Leang and Lee Sue Ann, the New Zealand Dollar (NZD) could potentially test 0.6265 if it manages to stay above the key level of 0.6215. The longer-term outlook suggests a continued advance with the possibility of reaching the year-to-date high of 0.6320.
Bulls may try to test 0.6265
24-HOUR VIEW: Despite a surprise rise to 0.6254, NZD’s upward momentum has not seen a significant increase. However, as long as it stays above 0.6215, there is a chance for NZD to test 0.6265 before any potential pause in the advance.
1-3 WEEKS VIEW: While the outlook remains bullish, the overbought conditions raise uncertainty about reaching the year-to-date high of 0.6320. A break below 0.6180 would indicate a weakening NZD.
Analysis:
The New Zealand Dollar (NZD) is poised for further gains, with a potential test of 0.6265 in the short term. However, caution is advised as overbought conditions may limit the upside, making it crucial to monitor the key support levels. A break below 0.6180 could signal a reversal in the trend, impacting trading strategies and investment decisions.