The upside bias on USD/CNH seems to have ebbed somewhat and the pair could now trade between 6.6600 and 6.7400 in the next few weeks.

Key Quotes

24-hour view: “Our expectations for USD to ‘trade sideways between 6.7050 and 6.7250’ was incorrect as it dropped to a low of 6.6919. While downward momentum has not improved by much, USD could decline but a break of 6.6820 is unlikely. Resistance is at 6.7040 followed by 6.7140.”

Next 1-3 weeks: “Two days ago (06 Jul, spot at 6.7140), we highlighted that shorter-term upward momentum is beginning to build and the risk of a break of 6.7400 has increased. However, USD has not been able to make any headway on the upside and the build-up in momentum has fizzled out. In other words, USD is likely to continue to consolidate and trade between 6.6600 and 6.7400 for now.”