USD/CNH: Further gains seen above 6.4880 – UOB

A break above 6.4880 should motivate USD/CNH to advance further in the next weeks, commented FX Strategists at UOB Group.

Key Quotes

24-hour view: “USD traded between 6.4535 and 6.4668 yesterday, narrower than our expected consolidation range of 6.4530/6.4730. While USD subsequently closed at 6.4665, it traded on a firm note during early Asian hours. Rapid improvement in upward momentum indicates that USD could strengthen to 6.4830. The major resistance at 6.4880 is unlikely to come into the picture. Support is at 6.4680 followed by 6.4640.”

Next 1-3 weeks: “We have expected USD to consolidate and trade between 6.4530 and 6.4880 since Friday (24 Sep, spot at 6.4610). While there is no change in our view, shorter-term upward momentum is beginning to improve. That said, USD has to close above 6.4880 before a sustained rise can be expected. At this stage, the odds for USD to close above 6.4880 are not high but it would remain intact as long as USD does not move below 6.4600 within these couple of days.”