Momentum is beginning to slow; the likelihood of the New Zealand Dollar (NZD) declining further to 0.6005 has decreased, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Likelihood of NZD declining to 0.6005 decreases

24-HOUR VIEW: “We noted last Friday that ‘momentum indicators are mostly flat, and we continue to expect NZD to trade in a range, probably between 0.6040 and 0.6080.’ NZD then traded in a narrower range of 0.6055/0.6079. Momentum indicators remain flat, and we continue to expect NZD to trade in a range, likely between 0.6055 and 0.6090.”

1-3 WEEKS VIEW: “In our most recent narrative from last Wednesday (16 Oct, spot at 0.6060), we highlighted that NZD ‘is likely to decline further, and the level to watch is 0.6005.’ We also highlighted that ‘Overall, only a breach of 0.6115 (‘strong resistance’ level) would mean that the weakness in NZD that started early this month has stabilised.’ NZD traded in a quiet manner the last couple of days. Momentum is beginning to slow, and the likelihood of NZD declining further to 0.6005 has decreased.”