United Overseas Bank strategists Quek Ser Leang and Lee Sue maintain a negative stance on USD/CNH, noting that the pair has been edging lower and remains under downward pressure. Short-term projections see scope to test nearby support, while the 1–3 week and 1–3 month views both favour continued gradual declines as long as the pair stays below key resistance and cloud boundaries.

Offshore Yuan strength caps Dollar

“24-HOUR VIEW: We expected USD to “edge lower” yesterday, but we pointed out that “slowing downward momentum suggests any decline should stay within a 6.6575/6.6655 range.” USD declined more than expected to 6.6559 before settling at 6.6564 (-0.07%). The downward pressure remains intact, and today, USD could edge lower and test 6.6520. A continued decline below this level is unlikely. Resistance is at 6.6605.”

“1-3 WEEKS VIEW: Following our negative USD view from the middle of the month, we highlighted two days ago (28 Oct, spot at 6.6655) that “there is a chance for USD to test 6.6550.” Yesterday, USD declined to a low of 6.6559. While oversold, the decline has not stabilised, and USD could continue to edge lower. The next level to watch is 6.6450. On the upside, a breach of 6.6640 (‘strong resistance’ level previously at 6.6700) would indicate that USD is not declining further.”