The New Zealand dollar (NZD) has stabilized after a period of gains, with market analysts from UOB Group suggesting a sideways trading pattern in the near term. The NZD recently saw an uptick, reaching a peak of 0.6013 on Tuesday and closing slightly higher at 0.6023 on Wednesday, marking a modest 0.25% increase from the previous day's value.
Analysts from UOB Group noted that while the NZD had risen to the forecasted limit of 0.6055 before retreating, it would need to surpass this threshold for further gains. They predict that in the next 1-3 weeks, the NZD could strengthen, provided it breaks above 0.6055, setting the stage for a potential advance toward 0.6100. This outlook is contingent on the currency maintaining above the strong support level of 0.5920.
Today, however, the upward momentum has waned, with predictions indicating that the NZD is likely to trade within a narrow range of 0.5980 to 0.6045, as opposed to climbing further.
In broader market movements, both the Australian dollar (AUD) and NZD weakened recently, with the NZD/USD pair hovering around 0.6000, which represents a 0.30% drop from New York's closing levels on Wednesday. The AUD/USD pair fell below 0.6500 after unwinding gains following positive job data.
The shift in currency strength occurs amidst a backdrop of negative equity sentiment and lower US futures, with regional markets under pressure. The Japanese yen has shown strength against both AUD and NZD as the USD/JPY pair declined to near 151.25. Other major currencies have remained relatively stable while US Treasury yields have extended gains within a narrow band.
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