USD/CNH now moved into a consolidative range – UOB

Pablo Piovano FXStreet

In light of the recent price action, USD/CNH is now likely trade within the 7.0900-7.18000 range, comment UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.

Key Quotes

24-hour view: While we expected USD to advance yesterday, we were of the view that “a sustained rise above 7.2000 appears unlikely”. USD then rose to 7.1916 before staging a surprising sharp selloff to 7.1180. The sharp and swift drop is overdone and USD is unlikely to weaken further. Today, USD is more likely to trade in a range of 7.1200/7.1600.

Next 1-3 weeks: The USD strength that started late last week ended abruptly as after rising to a fresh high of 7.1916, it then plunged below our ‘strong support’ level of 7.1400 (low of 7.1180). The 7.1916 is likely an interim top and USD has likely moved into a consolidation phase. For the time being, USD is likely to trade between 7.0900 and 7.1800.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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