USD/CNH: Likely to trade between 6.9660 and 7.016 – UOB Group
|Tentative increase in upward momentum suggests US Dollar (USD) could test 6.9950. In the longer run, outlook for USD is neutral now; it is likely to trade between 6.9660 and 7.0160, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Outlook for USD is neutral now
24-HOUR VIEW: "We expected USD to 'trade in a range between 6.9720 and 6.9880' yesterday. However, after dipping to a low of 6.9790, USD edged to a high of 6.9925. There has been a tentative increase in upward momentum, and USD could test the resistance at 6.9950. A break above this level is not ruled out, but given the tentative momentum, any further advance is unlikely to reach 7.0050. Support levels are at 6.9850 and 6.9800."
1-3 WEEKS VIEW: "Our most recent narrative was from Monday (05 Jan, spot at 6.9735), in which we indicated 'the sharp decline in USD last month appears to be overextended'. We also indicated that 'although there is no clear sign of stabilization yet, deeply oversold conditions and waning downward momentum, suggest the downside potential could be limited to a test of 6.9590'. Yesterday, USD edged to a high of 6.9925. Although our ‘strong resistance’ level at 6.9950 has not been breached yet, downward momentum has more or less eased. In other words, the outlook for USD is neutral now, and we expect it to trade between 6.9660 and 7.0160."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.