USD/CNH: Likely to trade in a range between 7.1530 and 7.1730 – UOB Group
The current price movements are likely part of a range trading between 7.1530 and 7.1730. In the longer run, downward momentum has increased further; if USD breaks below 7.1450, the next level to monitor is 7.1300, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.
Downward momentum has increased further
24-HOUR VIEW: "Yesterday, we noted that 'there is potential for USD to drop below 7.1500.' However, we stated that 'it is unclear for now whether there is sufficient momentum for USD to reach 7.1450.' USD subsequently dropped briefly to a low of 7.1500 before rebounding. USD closed largely unchanged at 7.1611 (+0.04%). The current price movements are likely part of a range trading phase, probably between 7.1530 and 7.1730."
1-3 WEEKS VIEW: "We turned negative on USD one week ago (25 Jun, spot at 7.1680). We highlighted that 'there has been a tentative buildup in momentum, and USD is likely to edge lower to 7.1450.' Yesterday (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.' USD subsequently dropped briefly to 7.1500. We will maintain our view as long as the ‘strong resistance’ at 7.1790 (no change in level) is not breached."
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