USD/CNH Price Analysis: Prints fresh low of 2020 under 6.8500, weekly close will be crucial

USD/CNH confirms double top bearish technical formation while declining below January’s low of 6.8456.
Oversold RSI, 200-week SMA questions the pair’s further selling.
A three-month-old falling trend line restricts recovery moves.
Better than forecast China PMIs pleases the bears.

Anil Panchal FXStreet

USD/CNH refreshes the yearly low to 6.8447, currently around 6.8478, during the early Monday’s trading. The cross-currency pair extends Friday’s losses to confirm the bearish chart pattern, namely “double top”, after China’s monthly official PMIs fared better than downbeat forecasts in August. Though, this week’s closing will be the key as a downside break below January’s bottom of 6.8456 can drive the prices further towards the south.

Read: Chinese Composite PMIs arrive at 54.5 in expansion territory

The sellers are currently targeting 38.2% Fibonacci retracement level of the quote’s upside from March 2018 to May 2020, at 6.8288.

However, oversold RSI conditions may join the 200-week SMA to challenge the pair’s additional downturn past-6.8125.

Meanwhile, a weekly closing beyond 6.8456 may attempt recovery moves towards the 6.9000 threshold while a downward sloping trend line from late-May, at 6.9310 now, can challenge the bulls afterward.

In a case where the USD/CNH prices rally past-6.9310, the 7.000 psychological magnet will be in the spotlight.

USD/CNH weekly chart

Trend: Pullback expected

Additional important levels

Overview
Today last price	6.848
Today Daily Change	-0.0112
Today Daily Change %	-0.16%
Today daily open	6.8592

Trends
Daily SMA20	6.9287
Daily SMA50	6.9865
Daily SMA100	7.0443
Daily SMA200	7.0233

Levels
Previous Daily High	6.8894
Previous Daily Low	6.8578
Previous Weekly High	6.9216
Previous Weekly Low	6.8578
Previous Monthly High	7.0764
Previous Monthly Low	6.9642
Daily Fibonacci 38.2%	6.8699
Daily Fibonacci 61.8%	6.8774
Daily Pivot Point S1	6.8482
Daily Pivot Point S2	6.8372
Daily Pivot Point S3	6.8166
Daily Pivot Point R1	6.8798
Daily Pivot Point R2	6.9004
Daily Pivot Point R3	6.9114

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.

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