USD/CNH Price Analysis: Rejected at bearish 5-day MA, risks revisiting recent lows


  • USD/CNH looks set to revisit the weekly low of 6.8659. 
  • A deeper drop looks unlikely as the US-China phase one deal was priced in advance. 

USD/CNH is reversing lower from the descending or bearish 5-day moving average (MA) resistance and risks revisiting the weekly low of 6.8659.

The pair is currently trading at 6.8858, having faced rejection at the 5-day MA hurdle at 6.8907 a few minutes ago.

The failure to take out the MA hurdle has reinforced the bearish view put forward by the long upper wick attached to Wednesday's candle and shifted risk in favor of a drop to 6.8659 (Tuesday's low).

However, dips below that level could be short-lived, as the CNH may come under pressure due to "sell the fact" trade.

Markets have bought the offshore Yuan since the beginning of the fourth quarter of 2019 in anticipation of the US-China phase one trade deal. The pair has dropped from 7.1675 to 6.8659 over the last 3.5-months. Now that the deal is signed, markets may book out of long CNH positions, helping USD/CNH regain some poise.

Daily chart

Trend: Bearish

Technical levels

USD/CNH

Overview
Today last price 6.8841
Today Daily Change -0.0076
Today Daily Change % -0.11
Today daily open 6.8917
 
Trends
Daily SMA20 6.9593
Daily SMA50 6.9954
Daily SMA100 7.0471
Daily SMA200 6.9746
 
Levels
Previous Daily High 6.9059
Previous Daily Low 6.8849
Previous Weekly High 6.9779
Previous Weekly Low 6.9102
Previous Monthly High 7.0879
Previous Monthly Low 6.9048
Daily Fibonacci 38.2% 6.8979
Daily Fibonacci 61.8% 6.8929
Daily Pivot Point S1 6.8824
Daily Pivot Point S2 6.8731
Daily Pivot Point S3 6.8614
Daily Pivot Point R1 6.9035
Daily Pivot Point R2 6.9152
Daily Pivot Point R3 6.9245

 

 

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