USD CNH | 1W | Technical AnalysisHelicopter view of USDCNH currency pair, and some ideas on how to act upon the recent price movements.
CNHUSD trade ideas
USDCNH | WEEKLY PERSPECTIVEWith over 800pips in our direction since my last publication (see link below for reference purposes), it appears that the Chinese Yuan is not reversing any time soon as USD/CNH risks a potential decline to the 6.9500/6.9300 area in the coming week(s).
Tendency: Downtrend ( Bearish )
Structure: Harmonic (AB = CD)
Observation: i. The fall of the USD since the beginning of this month (July 2020) appears to continue as we anticipate a Breakdown of my Key level 6.98000 leading to a Harmonic pattern.
ii. ABCD pattern expectations:
a. Impulse A-to-B expected to be in harmony with the potential C-to-D leg.
b. The B- to-C leg is at 50.0% Fibonacci retracement of the A-to-B leg.
c. The C-to-D leg is expected to fall within 127.2 - 1.414% Fib. ext. of the A-to-B move.
Trading plan: SELL confirmation with a minimum potential profit of 450 pips.
Risk/Reward: 1:2.5
Potential Duration: 1 to 4 days
NB: This speculation can be considered to make decisions on lower timeframes.
Watch this space for updates as price action is been monitored.
NirvanaForex
Risk Disclaimer:
Margin trading in the foreign exchange market (including foreign exchange trading, CFDs, etc.) has a high risk and is not suitable for all investors. The content of this speculation (including all data) is organized and published by me for the sole purpose of education and assistance in making independent investment decisions. All information herein is for your reference only and I take no responsibility.
You are hereby advised to carefully consider your investment experience, financial situation, investment objective, risk tolerance level and consult your independent financial adviser as to the suitability of your situation prior to making any investment.
I do not guarantee its accuracy and is not liable for any loss or damage which may result directly or indirectly from such content or the receipt of any instruction or notification therewith.
Past performance is not necessarily indicative of future results.
USDCNH | 1D | 1 Year ChannelUSDCNH has been moving in a horizontal channel since July 2019. It already tested support and resistance 1 time, and now heading down to test support again. Keeping it on my radar to see if the price will hit the bottom of the channel by the end of summer 2020.
The Chinese yuan continues to see gains against the US dollarThe Chinese yuan continues to see gains against the US dollar this Wednesday. Although yesterday the buck appeared like it’s forcing a recovery, there are more fundamental factors supporting the Chinese yuan’s case. The pair will likely reach its support levels this July thanks to the positive sentiment sparked by American investment banking company, Goldman Sachs. Just recently, it was reported that the bank sees the Chinese yuan strengthening further against the beloved US dollar in the next twelve months. According to the bank’s strategists, the Chinese yuan will primarily rally thanks to the recovery of the Chinese economy’s health. It’s no new news that China, where the outbreak started, has very few existing cases as of writing. That comes in contrast to the number of cases seen in the United States. Aside from that, the economic recovery of some of China’s biggest trading partners is helping the yuan power through.
Currency war?Hi All,
So YUAN broke the trend line, and seems to be more bearishness action.
Is all this intentional?
Governments trying to devalue their currencies?
What do you think?
Thnx
Jad
USD/CNH 7/7/2020Welcome to this analysis on USD/CNH.
Looking at the daily chart, the price has been trading in a wide range between 6.85 and 7.2 since July. On 28th of May price tested the top resistant of the range and got rejected from there and created a Head And Shoulders reversal pattern at the top half of the range that just got activated by a break and close below the neckline of the pattern at 7.04. The target of the Head And Shoulders is around 6.88 as long as the price doesn't move back up above the right shoulder of the pattern.
The first support zone below the price is around 6.92 and below that the low of the range at 6.85.
This trade idea has 4 rewards to risk ratio.
Good luck trading.
USDCNH A Great Buying OpportunityTrade Proposal:
There is a probability of first tp to the proposed (7,04535) Direction line. So, Traders can set orders based on Price Action and expect to reach short-term goals.
Technical analysis:
USDCNH Waiting for the Range Bound and the beginning of the Ascension Trend.
TP1= 7,04535
SupportedA rising support line is claiming that we may see a retracement despite the position below the MA.
USDCNH Bullish OpportunityWaiting for Price to Breakout of this minor trend line holding price orders, in order to enter with precision and proper Risk/Reward. I have to wait and adapt to the market conditions that show when the market opens, by adapting means by adjusting the trading idea as price flows closer to support if it decides to. Get your Buy Stops ready is all I'm saying.
Trade idea USDCNH longUSDCNH follows a medium-term uptrend. On 27/05/2020 the pair reached its previous high at 7.20 and got rejected. In the last two weeks we saw a decline back to the SMA200 at 7.0450 where we today saw a rebound in an environment of risk aversion and dollar strength. This situation gives a long engagements a very good return/risk ratio. Trade parameters are as follows:
- entry at current level of 7.08
- stop loss at 7.01 (conservative approach) or below 7.04 (aggressive approach)
- take profit at 7.195 for 67% of the position
USDCNH trend is reversing!Look at the chart and the channel, a ABC of 6 years is over.
Expect USDCNH to go blow 6.
USD/CNH Weekly channel- possible long opportunityAs we can see, USD/CNH has been moving within an upward channel on the weekly timeframe. The price is currently near the bottom of the channel, so as we monitor price action in this area, we will look for a long opportunity after seeing bullish momentum come in.
USDCNH | WEEKLY FORECASTThe Yuan has been on the rise since the beginning of June 2020 and it does not appear that there will be a "slow-down" in the following week as the Greenback continues to depreciate.
Tendency: Downtrend ( Bearish )
Structure: Breakdown | Descending Triangle | Support & Resistance
Observation: i. A structure depicted by drawing one trend line that connects a series of lower highs and a second horizontal trend line that connects a series of lows confirms our Descending Triangle .
ii. This pattern clearly explains that the Demand for the USD is weakening;
iii . As we anticipate price to break below our lower support @ 7.05000 (a psychological level) indicating downside momentum will become stronger in the following week(s).
iii . In as much that we shall be wary of false Breakdowns at the lower support, we shall eye a further Breakdown of Daily chart Trendline with engulfing candles as comfort .
iv. Please note that as the price keeps putting pressure on the 1st Key level throughout last week, a Breakdown of this level might be a zone to initiate sell order for quick gains.
Trading plan: SELL confirmation with a minimum potential profit of 450 pips.
Risk/Reward: 1:2.5
Potential Duration: 1 to 5 days
NB: This speculation can be considered to make decisions on lower timeframes.
Watch this space for updates as price action is been monitored.
Risk Disclaimer:
Margin trading in the foreign exchange market (including foreign exchange trading, CFDs, etc.) has a high risk and is not suitable for all investors. The content of this speculation (including all data) is organized and published by me for the sole purpose of education and assistance in making independent investment decisions. All information herein is for your reference only and NFTI takes no responsibility.
You are hereby advised to carefully consider your investment experience, financial situation, investment objective, risk tolerance level and consult your independent financial adviser as to the suitability of your situation prior to making any investment.
NFT&I does not guarantee its accuracy and is not liable for any loss or damage which may result directly or indirectly from such content or the receipt of any instruction or notification therewith.
Past performance is not necessarily indicative of future results.
Chinese fight backThe resistance zone has worked well, and the rising wedge broke down definitely. Now a clear sideways movement is ongoing, so sooner or later the next downside pressure should come and lead the price below the rising trendlines.
Next target lies at 7, 6.85, 6.7 but I forecast more Yuan strengthening to 6.3.
Any trading above 7.2 will open the door in front of the USD bulls and further rising should come.
The US dollar was seen sliding against the Chinese yuanEarlier this week, the US dollar was seen sliding against the Chinese yuan thanks to the upbeat results from mainland China’s economy. Unfortunately for the Chinese yuan, it wasn’t able to hold on to its gains in the sessions thanks to the recent news about rate cuts from the People’s Bank of China. The pair is now projected to rally towards resistance level in the coming sessions, a feat that should bolster the 50-day moving average against the 200-day moving average. Earlier this week, the Chinese manufacturing PMI from June showed a gradual improvement from 50.6% to about 50.9%, topping projections of about 5.4%. Aside from that, the Caixin manufacturing PMI for June also showed an increase in the private manufacturing sector from 50.7% to about 51.2%. the main source of the yuan’s weakness is the decision of the PBOC to set its midpoint rate earlier today, giving room for bullish investors to thrive in the trading sessions.
USD CNH - Escalation of Tensions !Relationships between the U.S and China have been deteriorating at a really fast pace since the begging of the Trade War between both countries back in 2018, where hundreds of billions of dollars in taxes over nationals goods, were exchanged. Despite the escalation of tensions, Trump's primary goal was to try to please the agricultural sector, since the farmer's states integrate a meaningful part of its electorate, so aiming re-election the promise of China in boosting its purchases of U.S agricultural goods served Trump needs.
However, the disastrous response of Trump to the COVID-19 outbreak in the U.S and other domestic crises has put its chances of re-election in jeopardy. With almost 3 million cases confirmed and more than 130,000 American lives ended, plus the massive riots across the country due to the murder of George Floyd by cops and the economic crisis that is hitting the country with an unemployment rate of 13.3%. A context that has been causing the growth of the dissatisfaction of the population with the state of the country, such discontentment is already appearing on the recent polls that put the Democrat candidate Joe Biden in a 10 points lead over Trump.
With the risk of losing re-election, Trump might use the oldest trick of the book of governors that want to unify the country and take the focus off its own failures, create a common enemy. In this case, China its the perfect fit, since the country was the first to report the new Coronavirus and has been moving to curb Hong Kong autonomy through the new security law. So Trump can target China first by blaming the country over the pandemic, and retaliating in defense of Hong Kong democracy, placing then meaningful sanctions and increasing the friction between both countries.
Looking at the monthly chart, the US Dollar Chinese Yuan Offshore is in a very intrigue spot now since the price is moving accordingly to the Elliott Wave rules so far, with a Wave 3 in process of formation. After the price confirmed a Wave 2 due to the retracement of near 76.4% of Wave 1, the CNH managed to surpass the top of Wave 1 confirming a possible Wave 3 that has the following targets based on the rules that determine the extension of this wave:
Targets:
1) 7.80869 - 161.8% of wave 1-2
2) 8.18008 - 200% of wave 1-2
3) 8.78091 - 261.8% of wave 1-2
4) 9.38174 - 323.6% of wave 1-2
This context shows us the possibilities of this new large impulse movement of the USD CNH been the reflection of the rasing of tensions between China and the U.S, as China will fight to increase the yuan relevance on the market as the U.S will try to undermine China influence on the global economy.
Thanks for reading, please feel free to share your comments and perspectives below, I'm still grinding my way to improve my analysis, so all feedback is welcome.
"A crisis is an opportunity riding the dangerous wind" - Chinese Proverb
Forex USD/CNH buy signals on W1USD/CNH, Weekly timeframe: Horizontal mirror level + Support line + Hammer candle pattern
