- USD/CNH upside remains capped below 6.91 resistance confluence.
- Overbought RSI adds strength to the bearish bias.
- Short-term ascending trend-line offers immediate support.
Despite rallying on Friday, the USD/CNH pair remains soft as it keeps trading below a key resistance confluence while taking the rounds to 6.8965 on early Monday.
The 200-bar moving average (4H 200MA) and 61.8% Fibonacci retracement of June month downpour restrict the quote’s immediate upside around 6.9067/77.
Should prices refrain from respecting overbought conditions of the 14-bar relative strength index (RSI), June 12 low near 6.9170 and June 18 high near 6.9400 can quickly become bulls’ favorites.
In a case of pullback, 50% Fibonacci retracement level of 6.8894 and an eight-day long ascending trend-line at 6.8876 can limit the pair’s short-term declines.
If sellers dominate below 6.8876, 38.2% Fibonacci retracement near 6.8722 and 23.6% Fibonacci retracement near 6.8510 may gain market attention.
USD/CNH 4-hour chart
Trend: Pullback expected