FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang still favour the continuation of the consolidative mood in USD/CNH in the next weeks.
24-hour view: “Yesterday, we highlighted that ‘the pullback amidst overbought conditions suggest that USD is unlikely to advance further’ and we expected USD to ‘trade between 6.6900 and 6.7300’. USD subsequently traded within a narrower range than expected (6.6949/6.7134). The underlying tone has softened and the bias for today is tilted to the downside. That said, any weakness is likely limited to a test of 6.6800. The major support at 6.6600 is not expected to come under threat. Resistance is at 6.7090 followed by 6.7190.”
Next 1-3 weeks: “On Monday (20 Jun, spot at 6.7080) we highlighted that USD is likely to trade between 6.6600 and 6.7400. There is no change in our view for now.”