USD/CNH: Extra consolidation on the table – UOB

FX Strategists Quek Ser Leang and Lee Sue Ann at UOB Group noted USD/CNH should remain trading within the 6.350-6.3900 range in the next weeks.

Key Quotes

24-hour view: “Yesterday, we highlighted that ‘there is room for USD to edge higher to 6.3780 before easing off’. Our expectations did not materialize as USD traded between 6.3670 and 6.3763 before closing little changed at 6.3731 (+0.06%). The underlying tone has softened somewhat and the risk for today is tilted to the downside. That said, a break of the 6.3600 support is unlikely. Resistance is at 6.3765 followed by 6.3820.”

Next 1-3 weeks: “Our view from yesterday (04 Apr, spot at 6.3700) still stands. As highlighted, the recent build-up in downward momentum has fizzled out.  USD appears to have moved into a consolidation phase and is likely to trade sideways between 6.3450 and 6.3900.”