- USD/CNH has bounced from multi-month lows to the 50-hour SMA resistance.
- Intraday charts show scope for a further corrective rally.
USD/CNH is currently trading near the 50-hour Simple Moving Average (SMA) hurdle of 6.4447, having printed a low of 6.4119 on Tuesday. That was the lowest level since June 2018.
The hourly and 4-hour chart relative strength indices (RSI) have now diverged in favor of the bulls. Meanwhile, the daily chart RSI is reporting oversold conditions with a below-30 print.
As such, a stronger corrective bounce to the 4-hour chart hurdle-turned-support of 6.4927 could be seen. However, a failure to beat the 50-hour SMA may invite selling pressure, yielding a drop to fresh multi-month lows below 6.40.
Trend: Corrective bounce
Credit: FX Street