USD/CNH still risks a move lower – UOB

USD/CNH is still seen attempting a move to the 6.4015 level in the next weeks, commented UOB Group’s FX Strategists.

Key Quotes

24-hour view: “Our view for USD yesterday was that it ‘could edge higher but a clear break of the major resistance at 6.4460 is unlikely’. However, USD traded in a quiet manner between 6.4310 and 6.4422. Indicators are mostly ‘flat’ and further consolidation would not be surprising. Expected range for today, 6.4250/6.4400.”

Next 1-3 weeks: “Our view from Wednesday (19 May, spot at 6.4255) still stands. As highlighted, USD is under mild downward pressure and could grind lower to 6.4015. At this stage, the prospect for a sustained decline below this level is not high. On the upside, a breach of 6.4460 (‘strong resistance’ level) would indicate that the current mild downward pressure has eased.”