USD/CNH: Price movements are likely part of a range trading phase – UOB Group

Current US Dollar (USD) price movements are likely part of a range trading phase vs Chinese Yuan (CNH), probably between 7.2530 and 7.2750. In the longer run, downward momentum has largely faded; USD is expected to trade in a 7.2400/7.2900 range for the time being, UOB Group’s FX analysts Quek Ser Leang and Peter Chia note.

Downward momentum has largely faded

24-HOUR VIEW: "Yesterday, when USD was at 7.2500, we noted 'a slight increase in downward momentum.' We added, USD 'could edge lower, but there are a pair of strong support levels at 7.2420 and 7.2350.' Our view did not materialise, as USD traded between 7.2481 and 7.2678, closing at 7.2660. The current price movements are likely part of a range trading phase, probably between 7.2530 and 7.2750."

1-3 WEEKS VIEW: "Our most recent narrative was from two days ago (25 Feb, spot at 7.2550), wherein 'the failure to hold below 7.2300 has diminished the likelihood of further decline.' Yesterday, USD edged to a high of 7.2678. While our ‘strong resistance’ level at 7.2705 has not been clearly breached yet, downward momentum has largely faded. USD has likely entered a range trading phase and is expected to trade between 7.2400 and 7.2900 for the time being."