Further consolidation in USD/CNH is expected in the near-term ahead of a potential resumption to the 6.5500 area in the next weeks, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “We expected USD to move higher last Friday but we were of the view that ‘last month’s peak at 6.5080 is unlikely to come into the picture’. However, USD blew past 6.5080 and surged to 6.5285 before easing off. The strong surge is overdone and further sustained USD strength is unlikely. USD is more likely to consolidate and trade within a 6.4900/6.5220 range.”
Next 1-3 weeks: “We have held a positive view in USD for more two weeks now. After USD retreated from 6.5080 and traded mostly sideways for several days, we highlighted in our latest narrative from last Friday (05 Mar, spot 6.4875) that ‘the overall outlook is still deemed as positive as long as USD does not move below 6.4400’. USD finally cracked 6.5080 as it surged to 6.5285 during NY hours. While overbought shorter-term conditions could lead to consolidation first, the current USD strength could extend to 6.5500 later on. The positive outlook is deemed intact as long as USD does not move below 6.4680 (‘strong support’ level previously at 6.4400).”
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.
Recommended content
Editors’ Picks
EUR/USD rises toward 1.0700 after Germany and EU PMI data
EUR/USD gains traction and rises toward 1.0700 in the European session on Monday. HCOB Composite PMI data from Germany and the Eurozone came in better than expected, providing a boost to the Euro. Focus shifts US PMI readings.
GBP/USD holds above 1.2350 after UK PMIs
GBP/USD clings to modest daily gains above 1.2350 in the European session on Tuesday. The data from the UK showed that the private sector continued to grow at an accelerating pace in April, helping Pound Sterling gather strength.
Gold price flirts with $2,300 amid receding safe-haven demand, reduced Fed rate cut bets
Gold price (XAU/USD) remains under heavy selling pressure for the second straight day on Tuesday and languishes near its lowest level in over two weeks, around the $2,300 mark heading into the European session.
Here’s why Ondo price hit new ATH amid bearish market outlook Premium
Ondo price shows no signs of slowing down after setting up an all-time high (ATH) at $1.05 on March 31. This development is likely to be followed by a correction and ATH but not necessarily in that order.
US S&P Global PMIs Preview: Economic expansion set to keep momentum in April
S&P Global Manufacturing PMI and Services PMI are both expected to come in at 52 in April’s flash estimate, highlighting an ongoing expansion in the private sector’s economic activity.