Search ForexCrunch

USD/CNH has jumped above 6.7113, confirming an inverse head-and-shoulders breakout on the 4-hour chart.  

The breakout has confirmed the bearish-to-bullish trend change first signaled by the bullish divergence of the relative strength index (RSI) on Feb. 24 and has opened the doors to 6.7493 (target as per the measured move method).  

Notably, the 200-candle moving average (MA) on the 4H chart, which acted as a stiff resistance last month, is currently located just above the breakout target.

Validating the breakout is the RSI reporting bullish conditions with an above-50 print.  

That said, the bullish pattern would fail if the pair falls back below 6.7113.  

4-hour chart

Trend: Bullish