USD/CNH: Downside momentum picked up pace – UOB

Pablo Piovano FXStreet

In opinion of FX Strategists at UOB Group, USD/CNH risks further retracements in the next weeks.

Key Quotes

24-hour view: “The sharp drop in USD that sent it plummeting to 6.4090 came as a surprise (we were expecting USD to consolidate). While the rapid decline appears to be overdone, the weakness in USD could test 6.4015 first before stabilizing. The next support at 6.3950 is unlikely to come under threat. Resistance is at 6.4180 followed by 6.4230.”

Next 1-3 weeks: “Yesterday, we highlighted that downward momentum has more or less dissipated and USD is likely to trade sideways within a 6.4100/6.4600 range. We did not anticipate the sharp drop that sent USD tumbling to 6.4090. Downward momentum has picked up again and the risk from here is for USD to break the major support at 6.4015. Looking ahead, a daily closing below 6.4015 would indicate that USD could decline towards the next support at 6.3800. The current downward pressure is deemed intact as long as USD does not move above the ‘strong resistance’ level at 6.4300.”

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

EUR/USD stays defensive below 1.1900 as USD recovers

EUR/USD trades in negative territory for the third consecutive day, below 1.1900 in the European session on Thursday. A modest rebound in the US Dollar is weighing on the pair, despite an upbeat market mood. Traders keep an eye on the US weekly Initial Jobless Claims data for further trading impetus.

GBP/USD holds above 1.3600 after UK data dump

\GBP/USD moves little while holding above 1.3600 in the European session on Thursday, following the release of the UK Q4 preliminary GDP, which showed a 0.1% growth against a 0.2% increase expected. The UK industrial sector activity deteriorated in Decembert, keeping the downward pressure intact on the Pound Sterling.

Gold sticks to modest intraday losses as reduced March Fed rate cut bets underpin USD

Gold languishes near the lower end of its daily range heading into the European session on Thursday. The precious metal, however, lacks follow-through selling amid mixed cues and currently trades above the $5,050 level, well within striking distance of a nearly two-week low touched the previous day.

Cardano eyes short-term rebound as derivatives sentiment improves

Cardano (ADA) is trading at $0.257 at the time of writing on Thursday, after slipping more than 4% so far this week. Derivatives sentiment improves as ADA’s funding rates turn positive alongside rising long bets among traders.

A tale of two labour markets: Headline strength masks underlying weakness

Undoubtedly, yesterday’s delayed US January jobs report delivered a strong headline – one that surpassed most estimates. However, optimism quickly faded amid sobering benchmark revisions.

Sonic Labs’ vertical integration fuels recovery in S token

Sonic, previously Fantom (FTM), is extending its recovery trade at $0.048 at the time of writing, after rebounding by over 12% the previous day. The recovery thesis’ strengths lie in the optimism surrounding Sonic Labs’ Wednesday announcement to shift to a vertically integrated model, aimed at boosting S token utility.