USD/CNH Price Analysis: Eight-month-old support line, oversold RSI test bears near 6.7200
- USD/CNH pares intraday losses around 13-day low, picking up bids of late.
- Ascending trend line from June 2022 appears a tough nut to crack for bears amid oversold RSI.
- 10-DMA guards recovery moves, three-week-old resistance line challenge bulls.
USD/CNH bounces off two-week low while picking up bids to 6.7180 during early Thursday morning in Asia. In doing so, the offshore Chinese Yuan (CNH) pair also justifies the oversold RSI conditions.
However, the quote’s sustained trading below the key SMAs and a downward-sloping trend line from early January keeps the USD/CNH bears hopeful.
It’s worth noting that not only the stated support line from June 2022, close to 6.7040, but the previous monthly low of 6.6975 also challenges the pair’s further downside.
Though, a sustained break of 6.6975 won’t hesitate to visit the mid-2022 bottom surrounding 6.6170.
Meanwhile, recovery moves may initially poke the 10-DMA hurdle of 6.7570 before challenging the 21-DMA resistance of near 6.7680.
Following that, a downward sloping trend line from January 10, close to 6.7880, will be crucial for the USD/CNH buyers as a break of which could confirm a short-term upside. Even so, the 6.8000 round figure may act as a final defense of the pair sellers.
Overall, USD/CNH remains on the bear’s radar unless crossing the 6.8000 psychological magnet even if a short-term recovery appears on the table.
USD/CNH: Daily chart
Trend: Corrective bounce expected