USD/CNH Price Analysis: Two-month falling trendline breached
- USD/CNH has breached key falling trendline hurdle.
- The pair has carved out a bullish engulfing candle on the weekly chart.
- The path of least resistance is to the higher side.
USD/CNH pair closed at 6.9282 on Thursday, confirming an upside break of the trendline sloping downwards from Dec. 3 and Dec. 24 highs.
The upside break of the descending trendline is accompanied by a bullish engulfing candle on the weekly chart and indicates the sell-off from September 2019 highs
near 7.20 likely ended at 6.8453 on Jan. 20 and the path of least resistance is now on the higher side.
At press time, the pair is sidelined around 6.9265, having hit a high of 6.9421 on Thursday.
Bulls now face immediate resistance at 6.9522 (Nov. 7 low), above which next hurdle is located at 6.9770 (38.2% Fib R of September high - January low).
On the lower side, support is seen at 6.8956 (Jan. 22 low) and 6.8659 (Jan. 14 low).