NZD/USD pullbacks limited around 0.72 – UOB

FX Strategists at UOB Group expect the downside in the Kiwi Dollar to appear limited around the 0.72 handle vs. the greenback.

Key Quotes

“NZD exceeded the 0.7280 target to hit a high of 0.7298. The subsequent sharp drop from the top was unexpected and the immediate pressure has shifted quickly to the downside. That said, the rapid decline appears to be running ahead of itself and any further weakness is likely limited to 0.7200 (next support at 0.7185)”.

“The quick rise to a high of 0.7298 and the equally rapid decline was unexpected. That said, the neutral phase that started last Friday, 16 Jun is still intact even though NZD is more likely to trade in a 0.7150/0.7275 range instead of extending higher towards the recent higher at 0.7320 as expected previously”.