USD/CNH technical analysis: 6.88/90 is the level to beat for buyers
|- RSI recovery/ascending triangle enables the USD/CNH pair to aim for key resistance confluence.
- Trade tussles join, fraud scandal at home weakens the Chinese currency off-late.
- 6.85 offers strong downside support.
Although 2-week old ascending triangle formation and rising RSI favor the USD/CNH pair’s additional recovery, the quote still trades below key resistances as it takes the rounds to 6.8825 on early Wednesday.
On a separate note, the US-China trade stalemate intensified recently after the US President Donald Trump cited “a long way” to expect a deal with China while also threatening to levy fresh tariffs. Further, Camsing fraud scandal at home also drags China’s offshore Yuan (CNH) lower.
50% Fibonacci retracement of June month declines, at 6.8894, acts as immediate resistances ahead of highlighting 6.88/90 confluence region comprising 200-bar moving average (4H 200MA) and a horizontal line stretched since early-month.
In a case prices refrain from respecting 14-bar relative strength index (RSI) and rally beyond 6.90, June 19 high around 6.9103 and 6.9155 may lure buyers.
On the downside, triangle pattern support around 6.8671 seems key to watch as the break of which can trigger fresh downpour to sub-6.8500 area.
USD/CNH 4-hour chart
Trend: Pullback expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.