- USD/CNH drops for third consecutive day after China’s Caixin Manufacturing PMI rose for the sixth month.
- Normal RSI conditions, sustained trading below three-month-old falling trend line favor the bears.
- Key Fibonacci retracements add to the upside barriers.
USD/CNH declines to 6.6860, down 0.16% intraday, amid early Monday’s trading. The pair recently responded to the welcome figure of China Caixin Manufacturing PMI for October. In doing so, the quote attacks 10-day SMA support.
China’s private gauge of manufacturing activity confirmed the upbeat prints of the official NBS Manufacturing PMI, 51.4 versus 51.3 expected, while printing 53.6 figures against 53.0 forecast and prior.
Read: Caixin China Manufacturing PMI 53.6 beats estimates of 52.8 and prior read of 53
Considering the upbeat data and normal RSI conditions, USD/CNH sellers are likely to provide a daily close below the 6.6880 nearby rest-point. Following that the 6.6600 can act as an intermediate halt during the fall towards the previous month’s low of 6.6276.
Meanwhile, a downward sloping trend line from July 24, at 6.7380 now, may keep challenging the intraday buyers of USD/CNH.
Even if the pair manages to cross 6.7380, the mid-September low of 6.7422 and the September month’s high near 6.8460 can challenge the bulls ahead of 61.8% Fibonacci retracement of July 24 to October 21 downturn, close to 6.8775.
USD/CNH daily chart
Trend: Bearish
Share
