USD/CNH should accelerate its losses on a breakdown of 7.2700, comment UOB Group’s Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia.
24-hour view: We did not expect USD to plummet to a low of 7.2861 last Friday (we were expecting it to trade in a range). While the outsized decline appears to be overextended, USD could drop to 7.2800 first before stabilisation is likely. The next support at 7.2700 is unlikely to come under threat today. On the upside, if USD breaks above 7.3080 (minor resistance is at 7.2970), it would mean that the weakness has stabilised.
Next 1-3 weeks: Our latest narrative was from last Wednesday (01 Nov, spot at 7.3350), wherein “upward momentum has increased slightly, but USD has to break and stay above 7.3470 before a sustained rise is likely.” We indicated that “the chance of USD breaking clearly above 7.3470 will remain intact as long as it stays above 7.3100 in the next few days.” On Friday, USD broke below 7.3100 and plummeted to a low of 7.2861. Not only has upward momentum dissipated, but downward momentum has also begun to build. However, USD must break clearly below 7.2700 before further decline is unlikely. The risk of USD breaking clearly below 7.2700 will remain intact as long as it stays below 7.3250 in the next few days.
© 2000-2024. All rights reserved.
This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).
The information on this website is for informational purposes only and does not constitute any investment advice.
The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.
Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.
Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.
Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.