USD/CNH still faces downside risks – UOB
|FX Strategists at UOB Group still believe USD/CNH could edge lower to the 6.80 region in the next weeks.
Key Quotes
24-hour view: “Our expectation for USD to ‘test the 6.8530 resistance’ last Friday did not materialize as it eased off from a high of 6.8499 before trading mostly sideways. The underlying tone has softened but any weakness from here is viewed as a lower trading range of 6.8250/6.8450 (a sustained decline below 6.8250 is not expected).”
Next 1-3 weeks: “Our latest narrative was from last Wednesday (02 Sep, spot at 6.8355) wherein ‘oversold short-term conditions could lead to consolidation first but overall risk is for further USD weakness towards 6.8000’. Our view was not wrong as USD traded in a relatively quiet manner for the past few days. While downward momentum has eased somewhat, the negative phase in USD that started in mid-August still has chance to push lower towards the round-number support level of 6.8000. Only a move above 6.8800 (no change in ‘strong resistance’ level) would indicate the negative phase in USD has run its course.”
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.