In opinion of FX Strategists at UOB Group, USD/CNH does not rule out a potential visit to the 6.87 area in the next weeks.
Key Quotes
24-hour view: “USD traded between 6.9249 and 6.9619 last Friday, narrower than our expected sideway-trading range of 6.9280/6.9700. The underlying tone has weakened even though any decline is unlikely to challenge the 6.9000 support. Only a move above 6.9500 would indicate the current downward pressure has eased.”
Next 1-3 weeks: “There is not much to add to our view from last Wednesday (04 Mar, spot at 6.9430). As highlighted USD is expected to weaken further to 6.9000. Since then, downward momentum has improved and from here, if USD were to register a NY closing below 6.9000, USD could weaken further to 6.8700. On the upside, the ‘strong resistance’ level has moved lower to 6.9700 from 6.9950.”
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