USD/CNH Price Analysis: Renews monthly low inside seven-week-old bearish channel
|- USD/CNH takes offers to refresh multiday low, down for second consecutive day.
- RSI, Momentum hints at further weakness before the bounce.
- Channel’s support, yearly bottom act as the key levels for bears to watch, 20-DMA guards immediate upside.
USD/CNH stands on the slippery ground near $6.3590, down 0.10% intraday as the quote drops to the fresh low since November 16 during early Wednesday.
In doing so, the Chinese offshore yuan (CNH) remains on the back foot inside a downward sloping trend channel established since October 19.
Given the descending RSI and Momentum line, not oversold, USD/CNH has some room to the south before hitting the likely reversal points.
Among them is the support line of the stated channel, around $6.3545, followed by the yearly low of $6.3524.
In a case where USD/CNH bears dominate below $6.3524, the bottom of the year 2018 near $6.2355 will be in focus.
Alternatively, 20-DMA level of $6.3815 guards immediate upside ahead of the channel’s upper line, close to $6.3970.
Should the USD/CNH breaks $6.3970, the $6.4000 threshold will challenge the bulls ahead of directing them to the descending resistance line from April, near $6.4620.
USD/CNH: Daily chart
Trend: Further weakness expected
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