USD/CNH Price Analysis: Drops to 10-week low on upbeat China data
- USD/CNH stays depressed around multi-day low after strong China Caixin Services PMI, trade numbers for April.
- Sustained trading below 100-SMA, bearish MACD favor sellers.
USD/CNH takes offers around 6.4560, down 0.13% intraday, while declining to the fresh low since late February on Friday’s pre-European session trading.
Although pair’s sustained trading below 100-day SMA and bearish MACD join the US dollar weakness, amid risk-on mood, favor the pair sellers, upbeat Caixin Services PMI and trade data from China seem to put a bid under the CNH of late.
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Against this backdrop, USD/CNH bears keep their eyes on the yearly horizontal support line around 6.4400 as nearby key levels. However, the pair’s inability to bounce off the key support may drag it to February’s bottom, also the yearly trough, near 6.4000.
If at all USD/CHF keeps trading southward below 6.4000 threshold, 61.8% Fibonacci Expansion (FE) of November-February drop, followed by the bounce till March 30, will be a crucial support to watch around 6.3540-35.
Meanwhile, corrective pullback needs to cross the 100-day SMA level of 6.4925 before attacking the 23.6% Fibonacci retracement level of the pair’s downside from late September 2020 to February 2021, near 6.5060.
Overall, USD/CNH bears keep the reins until the pair crosses April’s top of 6.5876.
USD/CNH daily chart
Trend: Bearish
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
