USD/CNH Price Analysis: Fades bounces off weekly support below 7.2000
- USD/CNH struggles to defend the recovery moves, retreats from intraday high.
- Steady RSI suggests further grinding towards the north.
- 12-day-old ascending trend line, 50-SMA adds to the downside filters.
- Bullish bias remains intact beyond 7.1000, buyers aim for a fresh all-time high.
USD/CNH reverses the previous day’s pullback from the record high during early Thursday morning in Europe, despite recent inaction around 7.1880.
In doing so, the offshore Chinese yuan (CNH) pair bounces off a horizontal area comprising multiple lows marked since Monday amid a steady RSI (14). However, bearish MACD signals and the buyer’s inability to keep the reins beyond the 7.2000 psychological magnet challenge the pair’s upside momentum.
It should be noted, however, that the pair’s pullback moves below the aforementioned immediate support near 7.1460-50 are likely to be challenged by an upward sloping support line from September 13, close to 7.1280 by the press time.
Also acting as a downside filter is the 50-SMA level surrounding 7.1125.
Even if the quote drops below 7.1125, the September 22 swing high near 7.1060 and the 7.1000 psychological magnet could act as the last defenses for the USD/CNH buyers.
Alternatively, recovery moves need to stay beyond the 1.2000 mark to convince buyers to aim for the multiple hurdles near 1.2500.
Following that, the recently flashed record high near 7.2600 and the 7.3000 psychological magnet will be in focus.
USD/CNH: Four-hour chart
Trend: Bullish