The prospects of USD/CNH surpassing the 7.1700 level keep losing momentum, noted FX Strategists at UOB Group.
Key Quotes
24-hour view: “While our view that USD is ‘likely to continue to consolidate’ was not wrong, the registered range of 7.0980/7.1184 was narrower than our expected 7.0900/7.1250. The price action offers no further clues and we continue to expect USD to consolidate. Expected range for today, 7.0950/7.1200.”
Next 1-3 weeks: “After rising strongly to 7.1652 on 19 Mar, USD has not been able to make much headway on the upside and subsequently traded mostly sideways. While upward momentum has deteriorated further, a break of 7.1700 is not ruled out just yet. To look at it another way, there is still chance for another up-leg above 7.1700 even though the prospect for such a move continues to diminish. Only a break of 7.0550 (‘strong support’ level previously at 7.0450) would indicate that 7.1652 is more significant top than currently expected.”
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