Usdcnh To Jump Higher Uob

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Usdcnh To Jump Higher Uob

Usd/Cnh To Jump Higher - Uob Group

According to an FX analyst from UOB Group, the USD/CNH is in overbought territory. However, the pair is likely to touch the 7.3145 handle before staging a pullback.

The overall momentum in the USD/CNH remains strong, while the high from last year (7.3678) also remains the next resistance.

Usd/Cnh Eyes The High At 7.3678

There's no doubt that the next stop for the USD/CNH is 7.3678, which is a significant high for the pair. The dominant theme in the USD/CNH is of US Dollar strength as event from the breaking of the 7.300 level few days ago.

Actually, the upward momentum in the US Dollar is really strong. UOB was initially forecasting the USD/CNH to be near 7.3000 in the short-term. However, it jumped to 7.3145 before dropping just below the 7.3000.

While the USD/CNH appears overbought, it will most definitely test the 7.3145 once again before going through a pullback.

However, the 7.3300 will remain out of reach for now. On the flip side, the 7.2860 support remains relevant, while the next one is seen around 7.2750.

During the next few weeks, the US Dollar will remain under the influence of buying momentum. This will be enough to uplift the USD/CNH pair and allow it to target the resistance near 7.3678.

However, the USD/CNH pair needs to hold the 7.2630 support for now. Failure to do so will mean the US Dollar has now taken the backstage while the CNH is in the driving seat.

In that case, the next support levels to watch will be 7.2500 and then 7.2400. However, the US Dollar strength will remain relevant for the medium to long-term.

With the fears of a resurgence in the Trade Wars, tariffs and slow growth, the odds favor the US Dollar for now. Also, the inflation in the USA may jump once again, forcing the Fed to halt its rate cuts. So, that's a scenario which also hints at a bearish CNH for now.

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