USD/CNH: Downside alleviated above 6.8550 – UOB
Further losses remain on the cards while USD/CNH trades below the 6.8550 level, comment UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.
Key Quotes
24-hour view: “Yesterday, we expected USD to trade sideways between 6.8550 and 6.9000. USD then traded between 6.8728 and 6.9054. The underlying tone has softened somewhat and USD is likely to edge lower today. However, a clear break of 6.8550 is unlikely. Resistance is at 6.8920, followed by 6.9020.”
Next 1-3 weeks: “We have expected USD to weaken since early last week. USD has not been able to make any headway on the downside. Downward momentum is waning rapidly and USD has to break and stay below 6.8550 in the next 1-2 days or it is unlikely to weaken further. Conversely, a breach of 6.9100 (‘strong resistance’ level) would suggest USD could trade sideways for a period of time.”