The Chinese yuan is gaining ground against the US dollar as USD/CNH dropped to 6.7459 after a failed rebound attempt, according to United Overseas Bank analysts Quek Ser Leang and Lee Sue Ann. The currency pair showed limited downside momentum during Thursday trading, though strategists anticipate possible intraday testing of last week’s 6.7420 low. However, UOB analysts express doubt about a sustained break below that support level, suggesting the yuan’s strengthening may face near-term limits despite its recent appreciation trajectory toward the 6.7300 handle.
The move signals continued pressure on the dollar in Asian currency markets, particularly affecting traders holding USD/CNH positions and businesses with yuan-denominated exposures. Market participants should watch whether the 6.7420 support level holds, as a decisive break could accelerate yuan gains and trigger stop-loss orders.
FXnCO Insight
USD/CNH traders should monitor the 6.7420 support closely for intraday opportunities, but prepare for range-bound conditions rather than a sustained breakout given UOB’s skepticism about deeper downside.
Source: FXStreet