USD/CNH: Further advance likely above 6.9350 – UOB
Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group see the likelihood of a sustained advance in USD/CNH once 6.9350 is cleared.
Key Quotes
24-hour view: “Yesterday, we expected USD to consolidate in a range of 6.8700/6.8900. USD dropped to 6.8733, soared to 6.9100 and then dropped back down to close at 6.8931 (+0.14%). Today, USD could retest the 6.9100 level before a more sustained pullback is likely. The next resistance at 6.9200 is unlikely to come under threat. Support is at 6.8780, followed by 6.8670.”
Next 1-3 weeks: “Our latest narrative was from Monday (17 Apr, spot at 6.8820) wherein there is no clear USD direction and it could trade in a relatively broad range of 6.8500/6.9200 for the time being. Yesterday, USD rose to 6.9100 and upward momentum is beginning to improve. However, USD has to break and stay above 6.9350 before a sustained rise is likely. The chance of USD breaking clearly above 6.9305 is not high for now but it will remain intact as long as the ‘strong support’ level at 6.8600 is not taken out in the next few days.”