In opinion of FX Strategists at UOB Group, USD/CNH is expected to remain side-lined in the next weeks.
24-hour view: “USD traded between 6.9322 and 6.9668 yesterday, narrower than our expected sideway-trading range of 6.9200/6.9700. The underlying tone has improved somewhat and from here, USD could edge higher to 6.9800. Support is at 6.9500 followed by 6.9400.”
Next 1-3 weeks: “The rebound from Monday’s (09 Mar) low of 6.9050 has been faster and more robust than expected. While our ‘strong resistance’ at 6.9700 is still intact (overnight high of 6.9668), the price action indicates that the weak phase that started in late February has found a short-term bottom at 6.9050. From here, USD is deemed to have moved into a consolidation phase and is expected to trade sideways for a period, likely between 6.9200 and 7.0000.”