- USD/CNH created a bearish outside bar candle on Thursday, an early warning of bearish reversal.
- Acceptance below Thursday’s low of 7.14 would confirm the trend change.
USD/CNH could suffer a deeper pullback if the support at 7.14 (Thursday’s low) is breached.
A move below that level would confirm or validate the bullish-to-bearish trend change signaled by Thursday’s bearish outside bar candlestick pattern.
A bearish outside bar occurs when the specific day’s price action engulfs the preceding day’s high and low.
As of writing, the USD/CNH pair is trading at 7.1478, representing marginal gains on the day.
A break below 7.14, if confirmed, would allow a deeper drop to the psychological support of 7.10. On the higher side, a break above 7.1774 (Thursday’s high) is needed to revive the bullish setup.
Daily chart
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Trend: Bearish below 7.14
Pivot points
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