UOB’s Quek Ser Leang and Lee Sue Ann observe that USD/CNH edged higher toward 6.79 but upward momentum remains limited. For the day, they expect consolidation in a 6.7800–6.7950 range. On a 1–3 week view, the pair is described as neutral, likely to trade between 6.7620 and 6.7980, while the broader 1–3 month bias still points to a gradual grind lower.

Range trading dominates Dollar Yuan

"24-HOUR VIEW: After our expectation for USD to “test 6.7850” did not turn out last Thursday, we indicated on Friday that “although upward momentum has not increased significantly, there is still a chance for USD to test 6.7850.” We added, “the next resistance at 6.7980 is unlikely to come under threat.” USD subsequently rose and broke above 6.7850, reaching a high of 6.7919. Despite the advance, upward momentum has not increased much. Today, instead of continuing to advance, USD is more likely to trade in a higher range of 6.7800/6.7950."

"1-3 WEEKS VIEW: Last Thursday (04 Jun, spot at 6.7750), we highlighted that the earlier “downward momentum has faded, and we are neutral on USD now,” and we expected USD “to trade between 6.7620 and 6.7980 for the time being.” On Friday, USD rose to a high of 6.7919. The increase in upward momentum is not sufficient to indicate a continued rise. In other words, we continue to hold the same view for now."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)