The USDCNH currency pair has experienced a rise in bids, pushing it to its highest levels since late November 2022, and this trend has continued for the third day in a row.
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- USD/CNH takes the bids to prod the highest levels since late November 2022, up for the third consecutive day.
The pair currently trades last at 7.17454.
The previous day high was 7.1604 while the previous day low was 7.1362. The daily 38.2% Fib levels comes at 7.1512, expected to provide support. Similarly, the daily 61.8% fib level is at 7.1455, expected to provide support.
USD/CNH renews a multi-day high as China’s central bank surprises market with a rate cut during early Tuesday. That said, the People’s Bank of China (PBoC) cuts the Repo Rate to 1.9% from 2.0% and propel the offshore Chinese Yuan (CNH) price towards 7.1750, the highest level since late November 2022, around 7.1710 by the press time.
With the rate cut from the PBoC confirming the previous fears suggesting slower economic growth in the world’s biggest industrial player, Bloomberg said, “China’s central bank cut a short-term policy interest rate, easing its monetary stance to help aid the economy’s recovery.”
Adding strength to the USD/CNH pair could be the market’s fears of more tension between the US and China as the US expands its ban on imports from Xinjiang. China vows to protect China firms against any US sanctions, per Reuters. Recently, Bloomberg released prepared remarks of US Treasury Secretary Janet Yellen’s scheduled Testimony in front of the House Financial Services Committee as she said that the International Monetary Fund (IMF) and the World Bank (WB) serve as important counterweights to non-transparent, unsustainable lending from others, like China.
It should, however, be noted that the market’s fears of dovish Fed performance in Wednesday’s Federal Open Market Committee (FOMC) join downbeat US Treasury bond yields to cap the USD/CNH upside.
Amid these plays, the S&P500 Futures struggles to trace Wall Street’s gains while the US 10-year and two-year Treasury bond yields drop for the second consecutive day to around 3.72% and 4.56% in that order.
Looking forward, USD/CNH traders should pay attention to today’s US Consumer Price Index (CPI) figures for May as the Fed decision looms on Wednesday. It’s worth noting that the market forecasts of witnessing no change in the Core CPI MoM figure of 0.4% gain major attention as softer figures could push back the July rate hike concerns and may not allow the Fed to sound hawkish.
The overbought RSI (14) line can challenge USD/CNH bulls within a three-week-old rising trend channel, currently between 7.2030 and 7.1300.
Technical Levels: Supports and Resistances
USDCNH currently trading at 7.171 at the time of writing. Pair opened at 7.156 and is trading with a change of 0.21% % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 7.171 |
| 1 | Today Daily Change | 0.0150 |
| 2 | Today Daily Change % | 0.21% |
| 3 | Today daily open | 7.156 |
The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 7.0875, 50 SMA 6.9821, 100 SMA @ 6.9219 and 200 SMA @ 6.9878.
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 7.0875 |
| 1 | Daily SMA50 | 6.9821 |
| 2 | Daily SMA100 | 6.9219 |
| 3 | Daily SMA200 | 6.9878 |
The previous day high was 7.1604 while the previous day low was 7.1362. The daily 38.2% Fib levels comes at 7.1512, expected to provide support. Similarly, the daily 61.8% fib level is at 7.1455, expected to provide support.
Note the levels of interest below:
- Pivot support is noted at 7.1414, 7.1267, 7.1172
- Pivot resistance is noted at 7.1656, 7.1751, 7.1898
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 7.1604 |
| Previous Daily Low | 7.1362 |
| Previous Weekly High | 7.1558 |
| Previous Weekly Low | 7.1012 |
| Previous Monthly High | 7.1344 |
| Previous Monthly Low | 6.8962 |
| Daily Fibonacci 38.2% | 7.1512 |
| Daily Fibonacci 61.8% | 7.1455 |
| Daily Pivot Point S1 | 7.1414 |
| Daily Pivot Point S2 | 7.1267 |
| Daily Pivot Point S3 | 7.1172 |
| Daily Pivot Point R1 | 7.1656 |
| Daily Pivot Point R2 | 7.1751 |
| Daily Pivot Point R3 | 7.1898 |
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