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  • USD/CNH has bounced slightly from the multi-month low of 6.60. 
  • The daily chart shows bearish sentiment is quite strong and recovery could be short-lived. 

While the USD/CNH pair has recovered from multi-month lows, the technical bias remains bearish. 

The pair is currently trading at 6.62, representing a 0.30% gain on the day, having hit a low of 6.60 early today. That level was last seen in January 2018. 

The bounce could be extended further, as the hourly chart now shows a bullish divergence. However, the broader outlook will remain bearish while the resistance of the trendline falling from May 27 and July 24 is held intact. As of writing, that trendline hurdle is located at 6.7430. 

Besides, the large upper shadows attached to the previous two daily indicate that the sell-on-rise mentality is quite strong. 

All things considered, a continued decline looks likely. A convincing daily close above the descending trendline is needed to abort the bearish view. 

Daily chart

Trend: Bearish

Technical levels