USD/CNH: Consolidation could extend further – UOB

USD/CNH would likely keep the 7.0500-7.2200 range unchanged for the time being, comment FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang.

Key Quotes

24-hour view: “We expected USD to ‘traded between 7.0800 and 7.1500’ last Friday. USD subsequently dropped to 7.0731 and rebounded to 7.1417 before closing at 7.1407 (+0.59%). The price movement is likely part of a consolidation phase and we expect USD to trade within a range of 7.1050/7.1700 for today.”

Next 1-3 weeks: “There is no change in our view from last Friday (30 Sep, spot at 7.1000). As highlighted, the recent USD rally has topped out for now. The current movement is likely the early stages of a consolidation phase. In view of the recent high volatility, USD could trade within a broad range of 7.0500/7.2200 for a period of time.”