Further gains could still lift USD/CNH to the 6.8500/6.8800 region in the next few weeks, note Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.
24-hour view: “Our expectations for USD to edge lower did not materialize as it traded in a relatively quiet manner between 6.7743 and 6.8023. The underlying tone has firmed somewhat but while the bias for USD is on the upside, any advance is unlikely to break 6.8150. Support is at 6.7850, followed by 6.7750.”
Next 1-3 weeks: “On Monday (06 Feb, spot at 6.8200), we highlighted that while short-term conditions are deeply overbought, as long as the ‘strong support’ level, currently at 6.7400 is not breached, USD could rise further to 6.8500, as high as 6.8800. We continue to hold the same view.”