USD/CNH Price Analysis: Yuan buyers flex muscles around 7.2800 on China stimulus

USD/CNH remains pressured on a day despite recent bouncing off intraday low.
Clear break of previous support line, U-turn from 10-DMA favor China offshore Yuan buyers.
RSI, MACD conditions also suggest further downside towards 50-DMA support.
Bulls need validation from 7.2360-70 to retake control.

Anil Panchal FXStreet

USD/CNH pares intraday losses around 7.2800 as China’s offshore Yuan (CNH) traders seek fresh clues to defend the daily losses during early Monday. In doing so, the Chinese currency cheers the broad pullback in the US Dollar amid a fresh bout of stimulus news from Beijing.

Also read: China cuts stamp duty on stocks trade, posts seventh fall in Industrial Profits as Sino-US talks loom

Technically, the pair’s downbeat break of a one-month-old previous support line joins the repeated failures to cross the 10-DMA immediate hurdle to keep the USD/CNH bears hopeful.

Also, the looming bear cross on the MACD and a downward-sloping RSI (14) line from the overbought territory weigh on the USD/CNH prices.

With this, the quote’s further downside toward the late July swing high of around 7.2370 appears imminent.

However, the 50-DMA and an ascending support line from late March, respectively near 7.2260 and 7.1920, can challenge the USD/CNH bears afterward.

On the contrary, a daily closing beyond the 10-DMA level surrounding 7.3020 can propel the USD/CNH price towards the five-month-old support-turned-resistance line of near 7.3160.

Even so, a horizontal area comprising multiple tops marked since August 16, close to 7.2370-60, can challenge the USD/CNH bulls before refreshing the yearly high.

USD/CNH: Daily chart

Trend: Further downside expected

Additional important levels

Overview
Today last price	7.2798
Today Daily Change	-0.0160
Today Daily Change %	-0.22%
Today daily open	7.2958

Trends
Daily SMA20	7.2542
Daily SMA50	7.2236
Daily SMA100	7.1136
Daily SMA200	7.0086

Levels
Previous Daily High	7.302
Previous Daily Low	7.2804
Previous Weekly High	7.3362
Previous Weekly Low	7.2676
Previous Monthly High	7.2744
Previous Monthly Low	7.116
Daily Fibonacci 38.2%	7.2938
Daily Fibonacci 61.8%	7.2886
Daily Pivot Point S1	7.2835
Daily Pivot Point S2	7.271
Daily Pivot Point S3	7.2618
Daily Pivot Point R1	7.3052
Daily Pivot Point R2	7.3145
Daily Pivot Point R3	7.3269

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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