USDCNH climbs to highest close since March 19th
US Dollar/Chinese Yuan Renminbi (USDCNH) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDCNH finished the week 0.22% higher at 7.1497 after gaining 166 pips (0.23%) today on high volume. Today's close at 7.1497 marks the highest recorded closing price since March 19th. Closing above Thursday's high at 7.1367, the market confirmed its breakout through the previous session high after trading up to 279 pips above it intraday.
Daily Candlestick Chart (USDCNH as at May 22, 2020):
Friday's trading range has been 381 pips (0.53%), that's above the last trading month's daily average range of 286 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for USDCNH.
Buyers managed to take out the key technical resistance level at 7.1374 (now S1), which is likely to act as support going forward. The last time this happened on April 15th, USDCNH gained 0.24% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
With prices trading close to this year's high at 7.1655, upside momentum could accelerate should the currency be able to break out to new highs for the year.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Resistance R1" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for USD/CNH. Out of 254 times, USDCNH closed lower 54.33% of the time on the next trading day after the market condition occurred.
With four out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.47% and EURUSD closing -0.44% lower. On the flipside the best performers have been USDCAD closing 0.33% higher and USDCHF gaining 0.08%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDCZK surging 1.09% and USDHUF closing 0.9% higher. The worst performers of the day have been USDMXN tanking -0.58% and SGDHKD closing -0.51% lower. Read more