USD/CNH still faces extra rangebound – UOB

USD/CNH is seen keeping the ongoing consolidative theme for the time being, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “We highlighted yesterday that USD ‘is expected to extend its advance but last month’s peak at 7.1652 is likely out of reach’. However, USD dropped quickly after touching a high of 7.1425. The ‘erratic’ price action over the past few days has resulted in a mixed outlook. From here, USD could continue to trade in a choppy manner between 7.0650 and 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.”