New Zealand Dollar (NZD) is expected to move higher, but the major resistance at 0.5920 is unlikely to come under threat. In the longer run, the likelihood of NZD breaking above the top of the 0.5820/0.5920 range is increasing, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Likelihood of NZD breaking above the top of the 0.5820/0.5920 range

24-HOUR VIEW: "Although we expected NZD to 'continue to rebound' yesterday, we pointed out that 'any advance is likely part of a higher range of 0.5840/0.5880.' However, NZD rebounded more than expected to 0.5892 and closed higher by 0.45% at 0.5885. Upward momentum has increased further, but not significantly. While we continue to expect a higher NZD today, the major resistance level at 0.5920 is unlikely to come under threat. Note that there is another resistance level at 0.5900. On the downside, support levels are at 0.5865 and 0.5855."

1-3 WEEKS VIEW: "Our most recent narrative was from Monday (25 Aug, spot at 0.5865), in which we stated that NZD 'appears to have entered a range trading phase, and for the time being, it is likely to trade between 0.5820 and 0.5920.' Yesterday, NZD rose to a high of 0.5892, and shorter-term upward momentum has increased somewhat. The likelihood of NZD breaking above 0.5920 has also increased, and it will increase further in the coming days provided that NZD holds above 0.5835."