USD/CNH technical analysis: 4H 200MA/61.8% Fibo. confluence is the level to beat for buyers

USD/CNH upside remains capped below 6.91 resistance confluence.
Overbought RSI adds strength to the bearish bias.
Short-term ascending trend-line offers immediate support.

Anil Panchal FXStreet

Despite rallying on Friday, the USD/CNH pair remains soft as it keeps trading below a key resistance confluence while taking the rounds to 6.8965 on early Monday.

The 200-bar moving average (4H 200MA) and 61.8% Fibonacci retracement of June month downpour restrict the quote’s immediate upside around 6.9067/77.

Should prices refrain from respecting overbought conditions of the 14-bar relative strength index (RSI), June 12 low near 6.9170 and June 18 high near 6.9400 can quickly become bulls’ favorites.

In a case of pullback, 50% Fibonacci retracement level of 6.8894 and an eight-day long ascending trend-line at 6.8876 can limit the pair’s short-term declines.

If sellers dominate below 6.8876, 38.2% Fibonacci retracement near 6.8722 and 23.6% Fibonacci retracement near 6.8510 may gain market attention.

USD/CNH 4-hour chart

Trend: Pullback expected

1. R3 6.9316
2. R2 6.9156
3. R1 6.9056
PP 6.8896
1. S1 6.8796
2. S2 6.8636
3. S3 6.8536

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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