USD/CNY is currently sidelined near 7.00 but analysts at Credit Suisse expect the pair to fall towards the July 2019 low around 6.85 during the third quarter.
Key quotes
“USD/CNY is moving lower in the early part of Q3, breaking below the 200-day average and the 2018 uptrend to complete an in-range top after earlier in the last quarter reaching and reversing from our Q2 target at the 7.1847 2019 high.”
“The ‘measured objective’ to the new in-range top suggests we should see a move to the 2020 and July 2019 low as well as the 38.2% retracement of the 2018/2019 upmove at 6.8625/8242, where we expect the market to hold and shift into a broad range. However, it’s worth noting that a break below here at any stage during the quarter would complete a major ‘double top’.”
“We ideally look to hold below 7.0416/7.0600 to maintain the downside pressure.”
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