- USD/CNH edges higher on Monday and climbs closer to a multi-day-old trading range hurdle.
- The mixed technical setup warrants caution before positioning for a further appreciating move.
- A convincing break below the 50-day SMA is needed to support prospects for a meaningful fall.
The USD/CNH pair builds on Friday's modest rebound from the 7.2595 region, or a nearly two-week low and gains some positive traction during the Asian session on Monday. Spot prices currently trade around the 7.2905 area, up over 0.10% for the day, flirting with the top boundary of a three-day-old range.
Looking at the broader picture, the USD/CNH pair is holding comfortably above technically significant 50-day, 100-day and 200-day Simple Moving Averages (SMAs), which, in turn, favours bullish traders. That said, oscillators on the daily chart are yet to confirm a bullish bias and warrant some caution before positioning for any meaningful appreciating move. Hence, any subsequent strength is more likely to confront a stiff barrier near the 7.3040-7.3050 region.
This is closely followed by resistance near the 7.3105 area, which if cleared should lift the USD/CNH pair towards the next relevant hurdle near the 7.3360-7.3365 region en route to the 7.3495 zone. Some follow-through buying beyond the 7.3500 mark should allow spot prices to challenge a multi-year peak, around the 7.3680-7.3685 region touched on September 8, which if cleared decisively will be seen as a fresh trigger for bullish traders.
On the flip side, the 7.2700 level now seems to protect the immediate downside ahead of Friday's low, around the 7.2595 zone and the 50-day SMA, currently pegged around the 7.2435 zone. A convincing break below the latter could prompt aggressive technical selling and drag the USD/CNH pair below the monthly low, around the 7.2390 region, towards testing the next relevant support near the 7.2135-7.2130 region.
USD/CNH daily chart
Technical levels to watch
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD loses traction, retreats below 1.0600
EUR/USD lost its recovery momentum and declined below 1.0600 in the American session on Friday, erasing a portion of its daily gains in the process. Nevertheless, the risk-positive market atmosphere after PCE inflation data helps the pair limit its losses.
GBP/USD turns negative on the day below 1.2200
GBP/USD reversed its direction and slumped below 1.2200 in the American session on Friday after rising above 1.2270 earlier in the day. Position readjustments and profit-taking on the last trading day of the quarter seems to be weighing on Pound Sterling.
Gold reverses direction, drops below $1,860
Following a steady rebound toward $1,880 on Friday, Gold price made a sharp U-turn and turned negative on the day near $1,860. Although the 10-year US T-bond yield is down more than 1%, XAU/USD struggles to find demand on the last day of Q3.
DOT confirms trend reversal, eyes retest of $5 after reclaiming key hurdle
Polkadot price seems to be ending its downtrend after shedding 92.91% in the last two years from its all-time high of $55.09. In the last three days, DOT has inflated by 3.3%, breaching a declining trendline and confirming the potential start of an uptrend.
Earnings beat triggers Nike to spike 9%
Nike (NKE) stock has surged over 9% in Friday’s premarket, climbing above $98 per share, following late Thursday’s fiscal first-quarter earnings release. Nike beat pessimistic earnings expectations by more than 23% and hiked its dividend by 9%.