UOB Group’s FX Strategists noted USD/CNH keeps looking to a test of the 6.4070 level in the near term.

Key Quotes

24-hour view: “We expected USD to ‘trade sideways between 6.3830 and 6.3970’ last Friday. USD subsequently traded between 6.3889 and 6.3999 before closing at 6.3885. USD dropped sharply during early Asian hours and could weaken to 6.3830. Resistance is at 6.3950 followed by 6.4000.”

Next 1-3 weeks: “We continue to hold the same view from last Thursday (25 Nov, spot at 6.3940). As highlighted, mild upward pressure could lead to USD edging higher to 6.4070. On the downside, a breach of 6.3750 (no change in ‘strong support’ level) would indicate that the current mild upward pressure has dissipated.”