Considering the view of FX Strategists at UOB Group, a near-term drop to 6.3525 in USD/CNH now seems to be losing traction.
24-hour view: “USD traded between 6.3687 and 6.3773 yesterday, narrower than our expected sideway-trading range of 6.3650/6.3800. The quiet price actions offer no fresh clues and further sideway-trading would not be surprising. Expected range for today, 6.3660/6.3810.”
Next 1-3 weeks: “On Wednesday (01 Dec, spot at 6.3650), we held the view that USD could weaken to 6.3525. However, USD has not been able to make any headway on the downside as it traded in a quiet manner the past couple of days. Downward momentum has eased and the odds for USD to move lower to 6.3525 have diminished. On the upside, a break of 6.3880 (no change in ‘strong resistance’ level) would indicate that the downside risk has dissipated.”