USD/CNH Price Analysis: Reverses post-FOMC run-up below 50-DMA
|- USD/CNH consolidates Fed-led gains below the key moving average.
- Bullish MACD signals back another effort to cross the DMA hurdle.
- April low, mid-May high adds to the upside barriers, monthly horizontal support lures sellers.
USD/CNH takes offers around 6.4255, down 0.22% intraday, while trimming the previous day’s gains amid early Thursday.
The offshore Chinese Yuan (CNH) jumped to the highest in a month by crossing multiple hurdles around 6.4100 following the US Federal Reserve (Fed) monetary policy announcements. Even so, the quote couldn’t cross 50-day SMA (DMA) and reverses afterward.
Read: US Fed: “Here We Come, Ready to Taper”, bond yields soar
While the quote’s latest pullback eyes the previous resistance from May 24, around 6.4100, any further weakness will be questioned by an ascending support line from May 31 and bullish MACD.
If at all the USD/CNH bears keep reins past-6.4100, 6.3780 may offer an intermediate halt during the pair’s slump towards the multi-month low, flashed last month, around 6.3525.
Alternatively, a clear break above the 50-DMA level of 6.4460 could push the pair prices towards another upside barrier surrounding 6.4615-20 comprising April low and early May’s high.
It should, however, be noted that the pair’s successful rally beyond 6.4620 will help the USD/CNH bulls to challenge the previous month’s high of 6.4930.
USD/CNY daily chart
Trend: Pullback expected
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