USD/CNH Price Analysis: Refreshes 14-month low after China Caixin PMI
- USD/CNH drops the lowest since July 2019 after China’s Caixin Manufacturing PMI beat forecasts with a positive margin.
- Sustained trading below 61.8% Fibonacci retracement, bearish MACD and CNH-positive data favor sellers.
- 200-week SMA can offer immediate rest to the pair before filling the early-May 2019 gap.
USD/CNH bears are unstoppable near the multi-month low of 6.8316 during the early Tuesday. The quote has been declining since the last six weeks while the latest weakness could be traced from China’s Caixin Manufacturing PMI for August.
China’s August month manufacturing activity data surged past-52.6 expected and 52.8 prior to 53.1. The figures joined the previous day’s official numbers that also rose above downbeat forecasts.
Technically, the pair’s sustained trading below 61.8% Fibonacci retracement level of March 2019 to May 2020 upside joins bearish MACD to suggest the quote’s additional weakness.
In doing so, the 200-week SMA level near 6.8125 becomes the sellers’ first choice ahead of the area between 6.7682 and 6.7178.
Alternatively, any recovery moves need to cross the previous day’s low near 6.8435 before diverting the upside moves to 61.8% Fibonacci retracement level of 6.8725.
USD/CNH weekly 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.
