USD/CNH: Declining bets on a break above 7.1700 – UOB

In opinion of FX Strategists at UOB Group, the chances of USD/CNH to break above the 7.1700 area have lost traction as of late.

Key Quotes

24-hour view: “USD traded between 7.0929 and 7.1195 last Friday, much narrower than our expected range of 7.0650/7.1250. The price action offers no fresh clues and USD is likely to continue to consolidate for now. Expected range for today, 7.0900/7.1250.”

Next 1-3 weeks: “There is not much to add to the update from Monday (30 Mar). As highlighted, the chance for USD to break above 7.1700 has diminished. However, only a breach of 7.0450 (‘strong support’ level previously at 7.0350) would indicate that the current upward pressure has eased. Looking ahead, a break of 7.0450 would suggest USD could spend trade in a broad range for a period.”