USD/CNH: Likely to consolidate between 7.1150 and 7.1340 – UOB Group

FXStreet Insights Team FXStreet

US Dollar (USD) is likely to consolidate between 7.1150 and 7.1340. In the longer run, USD remains negative, and it could drop and potentially break below 7.1000, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

USD remains negative

24-HOUR VIEW: "Following the sharp drop in USD that reached a low of 7.1185, we indicated last Friday that USD 'could test 7.1100 before stabilization can be expected.' We added, 'the next support at 7.1000 is unlikely to come into view.' The subsequent price action did turn out as we expected, with USD trading in a range of 7.1160/7.1318. USD closed marginally higher at 7.1230, up by 0.03%. The price movements are likely part of a consolidation phase. Today, we expect USD to trade between 7.1150 and 7.1340."

1-3 WEEKS VIEW: "We turned negative on USD early last week (see annotations in the chart below). Tracking the subsequent price movements, we indicated last Friday (29 Aug, spot at 7.1200) that USD 'remains negative, and it could drop and potentially break below 7.1000.' There is no change in our view. Overall, only a breach of 7.1500 (‘strong resistance’ previously at 7.1550) would indicate that USD is not ready to move below 7.1000."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD: Downward-sloping trendline near 1.3470 remains key barrier

The British pound faces selling pressure against its major currency peers, trading 0.1% lower at around 1.3420 against the US Dollar during the European trading session on Tuesday.

Euro clings to the bid bias above 1.1500

EUR/USD has picked up pace, reversing Monday’s decline and advancing past the 1.1500 barrier on Tuesday. In the meantime, hopes for a diplomatic solution to the Middle East crisis keep the US Dollar under modest downside pressure, helping spot in its recovery.

Coinbase Bitcoin Premium Index extends historical negative streak as risk appetite deteriorates

The Coinbase Bitcoin Premium Index extends its negative streak to 78 consecutive days on Tuesday, the longest on record. This reading comes amid the ongoing bearish trend, which has seen Bitcoin (BTC) drop by almost 50% from its record high to trade around $64,000.

Why the WTI sell-off may be hiding a supply warning

Prices for the barrel of the American Oil benchmark have fallen sharply as hopes of a US-Iran agreement have resurfaced, but a deeply backwardated Oil curve, tight Cushing stocks and light speculative positioning all warn that the sell-off may have gone too far.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.