A deeper pullback emerges on the horizon in case USD/CNH breaches 7.1100 in the near term, suggest UOB Group’s Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia.
24-hour view: We indicated yesterday that “as long as USD stays below 7.1500, it is likely to edge lower.” Our view was incorrect as USD rose to high of 7.1550. The advance lacks momentum, and USD is unlikely to rise much further. Today, USD is more likely to trade in a range, probably between 7.1300 and 7.1580.
Next 1-3 weeks: Our update from yesterday (04 Dec, spot at 7.1250) is still valid. As highlighted, the recent price action has resulted in a slight increase in downward momentum. If USD breaks the major support at 7.1100, the next level to watch is 7.0600. Conversely, if USD breaks above 7.1660 (no change in ‘strong resistance’ level), it would mean that the USD weakness from the middle of last month has stabilised.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.