Extra selling pressure could force USD/CNH to revisit the 6.8100 region in the short term, comment Markets Strategist Quek Ser Leang and Senior FX Strategist Peter Chia at UOB Group.

Key Quotes

24-hour view: “We expected USD to edge higher yesterday but we were of the view that ‘any advance is unlikely to break 6.9100’. While USD advanced more than expected, it fell sharply from a high of 6.9118. USD continues to fall in early Asian trade and the risk has shifted to the downside. However, the major support at 6.8100 is unlikely to come into view today (there is another support at 6.8300). On the upside, 6.8780 is a solid resistance level (minor level is at 6.8660).”

Next 1-3 weeks: “Our latest narrative was from Monday (27 Mar, spot at 6.8700) wherein we highlighted that the recent USD weakness has stabilized and that USD is likely to trade between 6.8100 and 6.9200 for now. USD fell sharply in early Asian trade today and downward momentum is building rapidly. The range-trading phase has ended and USD is likely to head lower even though 6.8100 might not be easy to break. The downside risk is intact as long as USD stays below 6.8900 (‘strong resistance’ level).”