August 5, 2020 USD / CNH Analysis

August 5, 2020 USD / CNH Analysis

UOB Group FX Strategists believe that if the USD / CNH breaches 6.9645, it will occur more withdrawal in the near term. 24-hour outlook: “We emphasized yesterday that the US Dollar could fall below 6.9755, but at 6.9645 the next support is unlikely to enter the table”. While the USD fell below 6.9755, it only managed to reach the lowest level of 6.9740. The underlying tone has weakened even further and may fall below USD 6.9645 today, but a continuous drop below this level is unlikely. The next support is 6.9580. Resistance is at 6.9820 and then at 6.9880. ” Next 1-3 weeks: "In our last Tuesday update (on July 28, 6.9900 region), we highlighted that the correction phase of the 6.9750 breache is over and the USD will increase the risk of falling below the lowest level of 6.9645 per month." Since then USD mostly traded horizontally and the downward momentum barely recovered, however, forward, the downside risk still looks higher.