USD/CNH technical analysis: Hits 2.5-month low, slow descent continues
- USD/CNH has hit the lowest level since mid-August.
- The daily chart shows a head-and-shoulders breakdown.
- The pair looks set to test the 100-day average for first since early May.
USD/CNH pair fell to 7.02582 a few minutes ago. That was the lowest level since Aug. 14.
The offshore Yuan (CNH) has gained ground in a slow and steady manner over the last two weeks, as suggested by the head-and-shoulders breakdown witnessed on Oct. 18.
The 5- and 10-day moving averages (MAs) are trending south, indicating a bearish setup and the 14-day relative strength index (RSI) is reporting bearish conditions with a below-50 print.
The USD/CNH pair looks set to test the 100-day average at 7.0251. That would be the first test of the long-term average since May 3. The bearish view would be invalidated above the 10-day MA at 7.0579.
Daily chart
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Trend: Bearish
Technical levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
