USD/CNH faces a deeper pullback below 7.2850 – UOB

A more sustained decline in USD/CNH needs to break below the 7.2850 region, comment UOB Group’s Economist Lee Sue Ann and Markets Strategist Quek Ser Leang.

Key Quotes

24-hour view: Yesterday, USD fell to a low of 7.3085. USD dropped further in early Asian trade today. The rapid increase in momentum is likely to cause further USD weakness towards 7.2950 (minor support is at 7.3020). In order to maintain the momentum, USD must not break above 7.3200 (minor resistance is at 7.3150). 

Next 1-3 weeks: USD fell by 0.23% (7.3111) yesterday. Downward momentum is building, but USD has to break clearly below 7.2850 before a sustained decline is likely. The chance of USD breaking clearly below 7.2850 will remain intact as long as it stays below 7.3260 in the next few days.