#USDCNH @ 7.11743 takes the bids to refresh multi-day high marked the previous day on mixed China data., @nehcap view: Limited upside expected (Pivot Orderbook analysis)

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• USD/CNH takes the bids to refresh multi-day high marked the previous day on mixed China data.
• China’s official PMIs came in softer-than-previous readings, Non-Manufacturing PMI appears less negative.
• One-week-old rising wedge, overbought RSI (14) prod offshore Chinese Yuan sellers.

The pair currently trades last at 7.11743.

The previous day high was 7.1094 while the previous day low was 7.0746. The daily 38.2% Fib levels comes at 7.0962, expected to provide support. Similarly, the daily 61.8% fib level is at 7.0879, expected to provide support.

USD/CNH prints 0.25% intraday gains as it prods the 7.1140 level while rising to the highest levels since November 2022 after almost downbeat China activity data for May published during early Wednesday. In doing so, the offshore Chinese Yuan (CNH) pair also justifies the US Dollar’s hesitance in declining further after witnessing a pullback from the previous day.

That said, China NBS Manufacturing PMI eases to 48.8 from 49.4 expected and 49.2 prior whereas Non-Manufacturing PMI rose past 50.7 market forecasts to 54.5 and 56.4 previous readings.

Also read: China’s NBS Manufacturing PMI contracts further to 48.8 in May vs. 49.4 expected

Although the data allowed USD/CNH to refresh a multi-day top, a seven-day-old rising wedge bearish chart formation and the overbought RSI (14) line, challenges the Yuan sellers.

Hence, the stated wedge’s top line near 7.1140 appears the immediate key hurdle to cross for the USD/CNH bulls to keep the reins. Following that, October 2022 low surrounding 7.1660 may gain the market’s attention.

Alternatively, an upward-sloping trend line from May 10 increases the strength of the 7.0790 support, a break of which confirms the rising wedge bearish formation suggesting a theoretical target of around 6.9600.

However, the 200-SMA level of around 7.6720 may act as intermediate halt whereas the monthly low of 6.8962 can lure the USD/CNH bears afterward.

Trend: Limited upside expected

Technical Levels: Supports and Resistances

USDCNH currently trading at 7.116 at the time of writing. Pair opened at 7.0908 and is trading with a change of 0.36 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 7.0018, 50 SMA 6.9358, 100 SMA @ 6.8887 and 200 SMA @ 6.9777.

The previous day high was 7.1094 while the previous day low was 7.0746. The daily 38.2% Fib levels comes at 7.0962, expected to provide support. Similarly, the daily 61.8% fib level is at 7.0879, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 7.0739, 7.0569, 7.0391
• Pivot resistance is noted at 7.1087, 7.1264, 7.1434

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