Extra weakness carries the potential to drag USD/CNH to the 6.7100 region in the next weeks, say FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.
24-hour view: “Yesterday, we expected USD to ‘trade between 6.7200 and 6.7500’. USD subsequently dropped to 6.7216, rebounded to 6.7442 before closing at 6.7442 (+0.31%). We expect USD to trade sideways for today, likely within a range of 6.7350/6.7550.”
Next 1-3 weeks: “Our narrative from yesterday (11 Aug, spot at 6.7290) still stands. As highlighted, the rapid build-up in downward momentum suggests USD could weaken further to 6.7100. Only a break of 6.7650 (no change in ‘strong resistance’ level from yesterday) would indicate that USD is unlikely to weaken further.”
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