Chinese Yuan: Are modest gains against the US Dollar likely while support holds? - UOB

Downward momentum in USD/CNH has strengthened slightly following the pair’s retreat from recent highs, according to United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann. Their outlook for the next 24 hours points to a modest decline in the Dollar, though they expect strong support at 6.6530 to hold; resistance stands at 6.6720. Confirmation of a broader recovery over 1–3 weeks would require a close above 6.6855.

Can key support limit the Dollar’s downward drift?

"24-HOUR VIEW: After USD popped to a high of 6.6855 and pulled back two days ago, we highlighted yesterday that “the pullback has scope to extend, but with no clear increase in downward momentum, USD is likely to stay within a range of 6.6620/6.6800.” USD then edged lower to a low of 6.6635. There has been a slight increase in downward momentum, and USD could continue to edge lower. That said, any decline is unlikely to break the strong support at 6.6530. Resistance is at 6.6720."

"1-3 WEEKS VIEW: We continue to hold the same view as yesterday (05 Nov, spot at 6.6720). As highlighted, “for USD to continue to recover, it must close above 6.6855.” On the downside, a breach of the ‘strong support’ at 6.6530 (no change in level) would indicate that USD is not recovering further. Looking ahead, if USD were to close above 6.6855, the next level to watch is 6.6940."

(An editor reviewed this article, which was produced with assistance from an Artificial Intelligence tool. Learn more.)