USD/CNH is forecast to keep navigating within the 6.4300-6.4800 range in the next weeks, commented FX Strategists at UOB Group.
24-hour view: “The sharp drop in USD to 6.4460 came as a surprise (we were expecting sideway-trading). The rapid drop appears to be overdone and USD is unlikely to weaken much further. Overall, USD is more likely to trade within a broad range of 6.4430/6.4680.”
Next 1-3 weeks: “We highlighted two days ago (29 Sep, spot at 6.4730) that ‘shorter-term upward momentum is beginning to improve but USD has to close above 6.4880 before a sustained rise can be expected’. We added, ‘the odds for USD to close above 6.4880 are not high but it would remain intact as long as USD does not move below 6.4600 within these couple of days’. USD broke 6.4600 yesterday as it dropped to 6.4460. The risk for USD to head higher has dissipated. From here, the outlook is mixed and USD could trade between 6.4300 and 6.4800 for a period of time.”
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