USD/CNH: Likely to trade sideways between 7.1640 and 7.1840 – UOB Group
US Dollar (USD) is likely to trade sideways between 7.1640 and 7.1840 against Chinese Yuan (CNH). In the longer run, downward momentum has not increased significantly, but bias for USD is on the downside toward 7.1500, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Downward momentum has not increased significantly
24-HOUR VIEW: "Following the sharp drop in USD last Friday, we indicated yesterday, Monday, that 'the decline appears to be overdone, but there is a chance for USD to test 7.1650 before stabilisation is likely.' We added, 'the major support at 7.1500 is unlikely to come into view.' USD then dropped to 7.1626 and then quickly rebounded to close largely unchanged (7.1783, +0.09%). Downward pressure appears to have eased, and USD is likely to trade sideways today, probably between 7.1640 and 7.1840."
1-3 WEEKS VIEW: "Yesterday (26 May, spot at 7.1770), we indicated that 'while downward momentum has not increased significantly, as long as 7.2070 (‘strong resistance’ level) is not breached, the bias for USD is on the downside toward 7.1500.' Our update still stands."
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