USD/CNH’s uptrend seems to be running out of steam, commented Lee Sue Ann and Quek Ser Leang, FX Strategists at UOB Group.
Key Quotes
24-hour view: “USD traded sideways between 6.7848 and 6.8206 yesterday before closing largely unchanged at 6.7965 (-0.06%). The movement appears to be part of a consolidation and further sideway-trading would not be surprising. Expected range for today, 6.7750/6.8150.”
Next 1-3 weeks: “n our latest narrative from last Thursday (12 May, spot at 6.8160), we highlighted that boost in momentum is likely to lead to further USD strength to 6.8500. USD rose to 6.8391 on Friday before pulling back. Upward momentum is beginning to wane and this coupled with overbought conditions has increased the risk of a short-term top. However, only breach of 6.7650 (no change in ‘strong support’ level) would indicate that the month-long rally in USD has finally come to an end.”