USD/CNH Price Analysis: Drops 0.20%, validating Monday’s Doji candle

• USD/CNH’s daily chart shows a bearish Doji reversal pattern. 
• The hourly chart also shows a head-and-shoulders breakdown.

USD/CNH is currently trading around 7.1155, representing a 0.20% drop on the day. 

The decline validates buyer exhaustion signaled by Monday’s Doji candle and has invalidated the bullish bias put forward by the falling channel breakout confirmed by Friday’s 0.73% gain. 

The doji reversal lower on the daily chart is supported by the head-and-shoulders breakdown on the hourly chart and a below-50 or bearish reading on the 14-hour relative strength index. 

The spot risks extending the decline toward the ascending 100-hour average at 7.1023. The outlook would turn bullish if the pair rises above 7.1370, invalidating a lower high setup on the hourly chart. 

Daily chart

Hourly chart

Trend: Bearish

Technical levels