USD/CNH Technical Analysis: Potential inverse head-and-shoulders
|The USD/CNH pair fell 0.4 percent yesterday, validating the bearish crossover between the 5 and 10-day moving averages.
The immediate bearish case, however, would weaken if the pair bounces off strongly from 6.7373-6.7350 support zone. That could be followed by a rally to 6.8033 (neckline of the inverse head-and-shoulders). A close above that level would confirm a bull reversal.
The probability of USD/CNH forming an inverse head-and-shoulders pattern would drop sharply if the support zone of 6.7373-6.7350 is convincingly breached.
Daily chart
Trend: bearish
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