USD/CNH seen within the 6.98-7.05 range for the time being – UOB

USD/CNH is seen navigating between the 6.98-7.05 range in the next weeks, suggested FX Strategists at UOB Group.

Key Quotes

24-hour view: “While our view that USD ‘could extend its down-move below the strong 7.0150 support’ was not exactly wrong, the swift recovery from a low of 7.0132 was not expected. Downward pressure has eased quickly and from here, USD is likely to trade sideways. Expected range for today, 7.0150/7.0400.”

Next 1-3 weeks: “After USD staged a strong rally last Thursday, we highlighted on Friday (21 Feb, spot at 7.0460) that ‘further USD strength is likely’ but we were of the view ‘it is too early to anticipate a move to the Dec’s peak at 7.0865’. USD subsequently rose to 7.0567 before easing off. The weak opening this morning suggests 7.0567 is likely an interim top. From here, USD could trade sideways for a period, likely between 6.9800 and 7.0500.”