NZD/USD: Firm resistance comes in at 0.7240 – UOB

In opinion of FX Strategists at UOB Group, the outlook for NZD/USD still points to further gains in the next weeks.

Key Quotes

24-hour view: “NZD traded between 0.7163 and 0.7218 yesterday, narrower than our expected sideway-trading range of 0.7145/0.7215. While the improved underlying tone suggests NZD could edge higher, the major resistance at 0.7240 is likely out of reach (0.7220 is already quite a strong level). Support is at 0.7185 followed by 0.7165.”

Next 1-3 weeks: “Our latest narrative from two days ago (20 Apr, spot at 0.7190) still stands. As highlighted, the risk for NZD is on the upside but the major resistance at 0.7240 may not come into the picture so soon. Looking ahead, the next resistance above 0.7240 is at 0.7270. On the downside, a break of 0.7145 (‘strong support’ level previously at 0.7120) would indicate that the NZD strength that started about one week ago (see annotations in the chart below) has run its course.”