USD/CNH is expected to return to the consolidative theme on a breakdown of the 7.0450 level, noted FX Strategists at UOB Group.
24-hour view: “We expected USD to trade between 7.0950 and 7.1350 yesterday. However, it slipped to a low of 7.0811 before ending the day on a soft note at 7.0933. Downward momentum has improved somewhat and this could lead to a dip towards 7.0650. For today, the next support at 7.0450 is unlikely to come into the picture. Resistance is at 7.0980 followed by 7.1100.”
Next 1-3 weeks: “There is not much to add to the update from Monday (30 Mar). As highlighted, the chance for USD to break above 7.1700 has diminished. However, only a breach of 7.0450 (‘strong support’ level previously at 7.0350) would indicate that the current upward pressure has eased. Looking ahead, a break of 7.0450 would suggest USD could spend trade in a broad range for a period.”
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