USD/CNH Price Analysis: Trades with modest intraday gains, 50-day SMA holds the key for bulls


  • 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

fxsoriginal

Technical levels to watch

USD/CNH

Overview
Today last price 7.2884
Today Daily Change 0.0084
Today Daily Change % 0.12
Today daily open 7.28
 
Trends
Daily SMA20 7.2969
Daily SMA50 7.2449
Daily SMA100 7.1734
Daily SMA200 7.025
 
Levels
Previous Daily High 7.2952
Previous Daily Low 7.2596
Previous Weekly High 7.3652
Previous Weekly Low 7.2596
Previous Monthly High 7.3496
Previous Monthly Low 7.1452
Daily Fibonacci 38.2% 7.2732
Daily Fibonacci 61.8% 7.2817
Daily Pivot Point S1 7.2614
Daily Pivot Point S2 7.2427
Daily Pivot Point S3 7.2258
Daily Pivot Point R1 7.297
Daily Pivot Point R2 7.3139
Daily Pivot Point R3 7.3326

 

 

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