US Dollar (USD) is likely to trade sideways between 7.1850 and 7.2100. In the longer run, renewed downward momentum suggests 7.1700 is back in sight, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Renewed downward momentum suggests 7.1700 is back in sight

24-HOUR VIEW: "Yesterday, when USD was at 7.2000, we expected USD to 'continue to weaken.' However, we pointed out, 'the major support at 7.1700 is likely out of reach for now.' We were not wrong, as USD dropped to 7.1791 and then rebounded to close largely unchanged at 7.1964 (-0.04%). Downward momentum has faded with the rebound. Today, USD is likely to trade sideways, probably between 7.1850 and 7.2100."

1-3 WEEKS VIEW: "We have held a negative USD view since early last week. As we tracked the price movements, we indicated yesterday (13 May, spot at 7.2000) that 'the renewed downward momentum suggests 7.1700 could be back in sight.' Our view remains unchanged. Overall, only a breach of 7.2330 (‘strong resistance’ level previously at 7.2420) would mean that the downside risk has faded."