USD/CNH: strong down trend holds

USD/CNH fell 9% from the top of 2020 as investors expected the recovery of the economy after the pandemic.

Downtrend 3

USD/CNH fell 9% from the top of 2020 as investors expected the recovery of the economy after the pandemic. Investors sold the safe-haven assets dollars to other assets. In addition, the strong China economic data also support the CNH.

On the economic front, China's industrial production rose 7.0% on year in November, as expected, while retail sales grew 5% on year,as expected, according to the government. China's economy shows a great recovery after the outbreak of COVID-19.

On a daily chart, USD/CNH is under pressure below both declining 20-day and 50-day moving averages. The relative strength index is capped by a declining trend line. Currently, the pair is near the 52-week low, suggesting the strong downside momentum for the prices. The bearish readers could set the resistance level at 6.6600, while resistance levels would be located at 6.4400 and 6.3200.

Source: GAIN Capital,TradingView

From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.