The continuation of the consolidation theme in USD/CNH appears the most likely scenario in the short-term horizon, comment Economist Lee Sue Ann and Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

24-hour view: The strong advance in USD that sent it to a high of 7.2649 came as a surprise (we were expecting it to dip to 7.2080). The rapid rise appears to be overdone but with no signs of weakness just yet, USD could test the resistance at 7.2800 before a pullback is likely. On the downside, a breach of 7.2350 (minor support is at 7.2470) would indicate that the current mild upward pressure has faded. 

Next 1-3 weeks: There is no change in our update from yesterday (05 Jul, spot at 7.2280). As highlighted, the recent USD strength has ended USD is likely to trade in a range 7.1800/7.2800 for now.