According to FX Strategists at UOB Group Lee Sue Ann and Quek Ser Leang, USD/CNH now looks to keep the range bound trade within 6.3450-6.3900 in the short-term horizon.
24-hour view: “The advance in USD to a high of 6.3720 came as a surprise (we were expecting USD to trade sideways between 6.3480 and 6.3650). Despite the advance, upward momentum has not improved by much. That said, there is room for USD to edge higher to 6.3780 before easing off. The next resistance at 6.3900 is not expected to come under threat. Support is at 6.3620 followed by 6.3550.”
Next 1-3 weeks: “Last Friday (01 Apr, spot at 6.3560), we highlighted that a break of 6.3450 would not be surprising but oversold shorter-term conditions could lead to 1-2 days of consolidation first. Instead of consolidating, USD rose to a high of 6.3720. While our ‘strong resistance’ level at 6.3730 not breached, downward momentum has fizzled out quickly. USD appears to have moved into a consolidation phase and is likely to trade sideways between 6.3450 and 6.3900.”