FX analysts Quek Ser Leang and Peter Chia from UOB Group note that the US Dollar (USD) still has room to test the 7.1500 level against the Chinese Yuan (CNH) before a pullback is likely. While upside momentum remains strong, the next key resistance at 7.1600 is unlikely to be reached in the near term.
Short-Term Outlook (24-Hour View):
The USD climbed to 7.1400 on Wednesday and reached as high as 7.1480 on Thursday, just shy of the key 7.1500 resistance. Despite being in overbought territory following this sharp rise, the pair still has scope to test 7.1500 before any meaningful pullback occurs. However, a move beyond 7.1600 is unlikely at this stage.
Support levels: 7.1380, 7.1330
Resistance level: 7.1500 (with 7.1600 seen as less likely for now)
Medium-Term Outlook (1–3 Weeks):
Earlier this week (Sep 22), UOB highlighted a likely consolidation phase for USD/CNH within the 7.1000–7.1360 range, though with a firmer underlying tone. As the pair surged past 7.1400, analysts noted that the increasing bullish momentum could push the pair higher.
If USD breaks above the 7.1500 resistance, the next level to watch will be 7.1600. However, a drop below 7.1250 would suggest that the upward move is losing steam. This level replaces the previously identified strong support at 7.1150.