USD/CNH Price Analysis: Breaks 10-week-old support to renew monthly low around 6.8500
- USD/CNH takes offers to renew multi-day low during three-day downtrend.
- Clear break of 2.5-month-long ascending trend line direct offshore Chinese Yuan buyers towards 6.8100.
- Recovery remains elusive below 100-DMA; previous monthly high is the key upside hurdle.
USD/CNH stands on slippery grounds as it breaks the short-term key support while refreshing the lowest levels in two weeks to around 6.8500 during early Friday.
Not only a clear break of the ascending trend line from early February but a downbeat RSI (14), not oversold, joins the quote’s sustained U-turn from the 100-DMA to also favor the offshore Chinese Yuan (CNH) buyers, which in turn weighs on the USD/CNH price.
With this, the USD/CNH pair is all set to visit a 2.5-month-old horizontal support area surrounding 6.8100.
However, the 6.8000 round figure and the easing RSI (14) line could challenge the USD/CNH bears afterward, if not then multiple levels marked during late January and early February, respectively near 6.7900 and 6.7750, could act as the last defense of the buyers.
On the flip side, the aforementioned support-turned-resistance line restricts the USD/CNH pair’s corrective bounce near 6.8570.
Following that, the 100-DMA level of around 6.8890 and the 6.8900 round figure could challenge the pair buyers.
In a case where USD/CNH remains firmer past 6.8900, the 6.9000 round figure and the previous monthly high of 6.9970 will be crucial to watch as it holds the key to the bull’s dominance.
USD/CNH: Daily chart
Trend: Further downside expected