USD/CNH: Likely to consolidate between 7.1600 and 7.1750 – UOB Group

USD is likely to consolidate between 7.1600 and 7.1750. In the longer run, the current price movements are likely part of a range trading phase between 7.1550 and 7.1850, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Current price movements are likely part of a range trading phase

24-HOUR VIEW: "Although we expected USD to 'edge lower' yesterday, we held the view that 'any decline is likely limited to a test of 7.1500.' However, after dipping to a low of 7.1570, USD briefly soared to a high of 7.1740. The sharp rise appears to be excessive, and USD is unlikely to rise much further. Today, USD is likely to consolidate between 7.1600 and 7.1750."

1-3 WEEKS VIEW: "We have expected a lower USD since last week. In our most recent narrative from Tuesday (01 Jul, spot at 7.1570), we indicated that 'downward momentum has increased further, and if USD breaks below 7.1450, the next level to monitor is at 7.1300.' Yesterday, USD spiked to a high of 7.1740. Although our ‘strong resistance’ level at 7.1790 has not been breached yet, downward momentum has eased. The current price movements are likely part of a range trading phase between 7.1550 and 7.1850."