USD/CNH: Set to slide and test 7.0980 – UOB Group

FXStreet Insights Team FXStreet

Price action continues to suggest further US Dollar (USD) weakness, even though it is too early to determine if the long-term support near 7.0980 is within reach, UOB Group FX analysts Quek Ser Leang and Lee Sue Ann note.

USD pushes towards the 7.0980 support

24-HOUR VIEW: “We did not anticipate the sharp selloff in USD last Friday (we were expecting sideways trading). The decline is severely oversold, and while further weakness is not ruled, the support at 7.1100 is unlikely to come under threat. Resistance is at 7.1650; a breach of 7.1900 would mean that the weakness has stabilised.”

1-3 WEEKS VIEW: “Our most recent narrative was from last Thursday (01 Aug, spot at 7.2200), wherein ‘short-term downward momentum is picking up, and the risk of USD breaking below 7.2037 is increasing.’ We indicated that ‘the risk of USD breaking clearly below 7.2037 will remain intact as long as 7.2600 (‘strong resistance’ level) is not breached.’ While USD subsequently rebounded (high of 7.2579), we indicated last Friday that we ‘will continue to hold the same view for now.’ USD then not only broke below 7.2037, but also plunged sharply, reaching a low of 7.1415. The price action continues to suggest further USD weakness, even though it is too early to determine if the long-term support near 7.0980 is within reach. On the upside, the ‘strong resistance’ level has moved lower to 7.2200 from 7.2600.”

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.

Bitcoin on-chain activity surges as Coldcard attack raises security concerns

Bitcoin on-chain activity has surged to its highest level of the year following attacks targeting Coldcard hardware wallets, according to a K33 report on Tuesday. The firm stated that 890,000 BTC were moved on-chain over the past week, marking a new yearly high.

RBI set to keep interest rates unchanged as inflation risks persist

The Reserve Bank of India is set to announce its bi-monthly monetary policy decision on Wednesday at 10:00 AM IST (04:30 GMT), another meeting coming at a time when uncertainty remains high over the duration and economic fallout of the ongoing Middle East conflict.

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.