USD/CNH Price Analysis: Bulls retreat from two-month-old hurdle
- USD/CNH steps back after refreshing the highest levels in two weeks.
- MACD turns the most bullish in a month, suggesting further upside.
- Ascending trend line from November 15 restricts immediate declines.
USD/CNH bulls take a breather around 7.2100, after refreshing a fortnight-high around 7.2600 level, during early Monday. In doing so, the offshore Chinese Yuan (CNH) pair witnesses a pullback from a two-month-old horizontal resistance area.
However, the pair’s sustained trading beyond a two-week-old ascending trend line joins the strongest price-positive MACD signals in a month to keep the USD/CNH buyers hopeful.
That said, a clear upside break of the 7.2600-2680 hurdle becomes necessary for the USD/CNH bulls to keep the reins.
Following that, a run-up towards refreshing the all-time high marked earlier in the year around 7.3750 can’t be ruled out.
It’s worth noting that the 7.3000 psychological magnet may act as an intermediate halt during the anticipated rally.
On the contrary, a downside break of the previously mentioned support line, close to 7.1655 by the press time, could recall the USD/CNH bears.
The same could direct the quote’s weakness towards the 50% Fibonacci retracement level of the August-October upside, near 7.0440.
Even so, the 100-Day Moving Average (DMA) support near 7.0065, quickly followed by the 7.0000 round figure could challenge the pair’s further declines.
USD/CNH: Daily chart
Trend: Further upside expected