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FX Strategists at UOB Group noted the upside momentum in USD/CNH could extend to the 6.8600 level in the next weeks.

Key Quotes

24-hour view: “Yesterday, we held the view that USD ‘could drift lower but any weakness is viewed as part of 6.8050/6.8350 range’. However, USD traded in a relatively narrow between 6.8101 and 6.8300 before closing little changed at 6.8165 (+0.09%). The price action offers no fresh clues and USD could continue to trade in a quiet manner for now, likely between 6.8050 and 6.8350.”

Next 1-3 weeks: “There is not much to add to our latest narrative from last Thursday (24 Sep, spot at 6.8220). As highlighted, the ‘rebound in USD could extend to 6.8600’. While momentum has not improved by much, there is still chance for USD to move to 6.8600. At this stage, the prospect for a sustained advance above this level is not high. Support is at 6.8000 but only a break of 6.7800 (no change in ‘strong support’ level) would indicate the current upward pressure has eased.”