USD/CNH: Expected to trade in a range between 7.2230 and 7.2520 – UOB Group
US Dollar (USD) is expected to trade in a range between 7.2230 and 7.2520 against the Chinese Yuan (CNH). In the longer run, while there has been no significant increase in momentum, USD could potentially drop to 7.2000, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
USD could potentially drop to 7.2000
24-HOUR VIEW: "After USD dropped sharply two days ago, we highlighted the following yesterday, when USD was at 7.2330: 'The sharp drop appears to be overdone, and while USD could recover today, as long as 7.2500 is not breached, there is potential for further downside toward 7.2200 before stabilization can be expected. The major support at 7.2000 is unlikely to come into view today.' The subsequent price movements did not quite turn out as we expected. USD dropped briefly to 7.2158, rebounded to 7.2500 and then closed at 7.2390. The weakness has stabilized, and today, we expect
USD to trade in a range 7.2230 between 7.2520."
1-3 WEEKS VIEW: "After holding a negative USD view since late last week, we indicated yesterday (12 Mar, spot at 7.2330) that 'while there has been no significant increase in downward momentum, USD could potentially drop to 7.2000.' We will continue to hold the same view, provided that the ‘strong resistance’ at 7.2650 (no change in level) is not breached."
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FXStreet Insights Team
FXStreet
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