USD/CNH now seen trading within 7.1300-7.2450 - UOB

Further consolidation is expected in USD/CNH for the time being, comment Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia at UOB Group.

Key Quotes

24-hour view: We did not expect USD to rise to 7.1897 (we were expecting it to trade sideways). Upward momentum has increased, albeit not much. Today, USD could rise to 7.2000. However, a sustained rise above this level is unlikely. Support is at 7.1670, followed by 7.1500. 

Next 1-3 weeks: Our most recent narrative was from last Friday (28 Jul, spot at 7.1700). We indicated in our update that “If USD breaks above 7.2000 it would suggest that 7.1000 is not coming into view this time around.” Yesterday, USD rose to a high of 7.1897. While our ‘strong resistance’ level of 7.2000 has not been breached yet, downward momentum has more or less dissipated. The current price actions are likely part of a consolidation phase. For the time being, USD is likely to trade in a range of 7.1300/7.2450.