Chinese Yuan: Uptrend extends toward 6.6450 against US Dollar – UOB

United Overseas Bank analysts Quek Ser Leang and Lee Sue maintain a bearish outlook on the USD/CNH pair, stating that the currency has been experiencing a downward trend. They project that the pair may test support levels in the short term, with both the 1-3 week and 1-3 month time frames indicating a continuing gradual decline, provided the pair remains below key resistance and cloud boundaries.

According to their 24-hour view, they anticipated the USD to "edge lower" yesterday, but were surprised by the more significant decline. The USD fell below expectations to 6.6559 before settling at 6.6564, experiencing a 0.07% decrease. Despite this downward pressure, the analysts believe that today, the USD could continue to edge lower, potentially reaching the 6.6520 level. They stress that a further decline below this level is unlikely, with resistance currently positioned at 6.6605.

In the 1-3 week outlook, the analysts touch upon a potential opportunity for the USD to test the 6.6550 level, which was observed yesterday at 6.6655. However, they note that while the pair is currently oversold, any decline has not yet stabilized, and the USD could continue to edge lower. On the upside, they suggest that a breach of the 6.6640 level, previously identified as 'strong resistance' at 6.6700, would indicate that the USD is not expected to decline further.