Economist at the UOB Group Lee Sue Ann and Markets Strategist Quek Ser Leang have stated that further downside could drag USD/CNH back to the 6.7000 regions in the next few weeks.
The key quotes read, ”Our view for USD yesterday was that it ‘could break 6.8000 but it might not be able to maintain a foothold below this level’. We indicated, ‘the next support is at 6.7700’.
USD weakened more than we expected as it dropped to a low of 6.7665. While oversold, the decline in USD could test the major support at 6.7500 before the risk of a more sustained rebound increases. In other words, a sustained decline below 6.7500 is unlikely. Resistance is at 6.8000, followed by 6.8150.”
Next 1-3 weeks: “Yesterday (09 Jan, spot at 6.8200), we indicated that USD is likely to weaken, albeit at a slower pace. We noted that support levels are at 6.7700 and 6.7500. USD subsequently dropped to a low of 6.7665. We continue to expect USD to weaken and if USD breaks below 6.7500, the focus will shift to 6.7000. Overall, only a break of 6.8500 (‘strong resistance’ level was at 6.8800 yesterday) would indicate that USD is not weakening further.”
United Overseas Bank Limited, often known as UOB, is a Singaporean multinational banking corporation headquartered in Singapore, with branches mostly found in most Southeast Asian countries.
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