- The USD/CNH closed yesterday at 6.8350, confirming a rising wedge breakdown on the daily chart and dipped below the 50-day moving average a few minutes before press time. The key moving average has come into play for the first time in five months.
- The rising wedge breakdown indicates that sell-off from the Aug. 15 high of 6.9584 has resumed and could yield a re-test of 6.7810 (Aug. 27 low) in the near-term.
- The 5-day and 10-day MAs are beginning to roll over in favor of the bears. Further, 14-day relative strength index (RSI) is teasing a drop into bearish territory below 50.00.
- A break above 6.8927 (Sept. 18 high) will likely put the bulls back into the driver’s seat.
Daily Chart
Spot Rate: 6.8334
Daily High: 6.8380
Daily Low: 6.8286
Trend: Bearish
R1: 6.8540 (10-day MA)
R2: 6.8927 (Sept. 18 high)
R3: 6.8955 (Aug. 24 high)
Support
S1: 6.8224 (Sept. 13 low)
S2: 6.7810 (Aug. 27 low)
S3: 6.7380 (July 26 low)