USDCNH Trading The TriangleIn this update we review the recent price action in USDCNH and identify the next high probability trading opportunity and price objectives to target
USDCNH trade ideas
USD/CNH Falling Wedge May Hint at Uptrend ResumptionThe US Dollar has been rising against the Chinese Yuan in June so far.
On the 4-hour chart, USD/CNH appears to be carving out a bullish Falling Wedge chart formation. A breakout above, with resistance as the 23.6% Fibonacci extension at 6.7304, opens the door to perhaps revisiting the May high at 6.8375.
Otherwise, a turn back lower towards 6.6131 would keep the Yuan on a slow and steady appreciation course against the US Dollar within the boundaries of the Falling Wedge.
FX_IDC:USDCNH
JICPT| CNH may weaken against USD with key support of 6.36! Hello everyone. It's been one months since I published an idea titled 'USDCNH testing policy bottom of Chinese Government'. Definitely, 6.35 is policy bottom which explained clear in the related idea below.
However, it kept going down until it touched 6.30. It was very interesting to observe the huge volume . I suspected government intervened as whole figure really mattered. 6.29ish is totally different from 6.30. Coincidentally, that was the day Putin announced military operation in Ukraine.
In the following days, I also noticed two abnormal volume with one thin candle and one thick candle respectively. Then, Chinese mainland market as well as Hong Kong market tumbled with CNH quickly weakened against USD. I don't think government stepped in this time. Short sellers were likely to jump in.
Did the downtrend channel got firmly violated? Not at all. The key support is 6.36. If it holds well, the pair may go sideways before forming another leg to conquer the trouble channel. If it failed, the pair is likely to seek support around 6.3250.
I think the weak CNH benefit China's economy. Of course, the government will also take into the account of the internalization of the currency. The strong CNH helps.
Everything has two sides. Let's see where it's going. My personal view is that the pair is likely to go back to 6.50 within the next two quarters .
What do you think?
USDCNH LONGBased on the current retracement to meet the previous Monthly High, We could say that this month has a Wick to fill.
-The Lower wicks From the previous Two weeks formed a Higher Low and a Bullish reversal pattern that we can observe when we go into the Lower Timeframes.
- In the Daily Timeframe, We can observe strong Bullish candles that can be used to confirm the Bullish Continuation through the Daily Timeframes.
With all this confluence based on the Top-Down approach, we could therefore look for an entry on the lower timeframes, mine would be based on the H4 TF with the expectation of a long move towards the next Key Level, which is the top wick on the Weekly Timeframe.
USDCNY 31st MAY 2022Asian shares erased early losses in Tuesday afternoon trade, as signs that China's economic pain may be gradually easing amid the easing of COVID-19 restrictions overshadowed broader investor concerns about a global inflation shock. Also lifting sentiment in the Asian region were details of Beijing's new policy support, which includes cash grants to hire fresh graduates and support for internet companies that list overseas.
China's official PMI for May showed factory activity continued to decline but at a slower pace than in April.
USDCNH APRIL 2022
USDCNH MARCH 2022
USD/CNH May Resume Broader Uptrend as China Faces Growth WoesThe US Dollar may regain its footing against the Chinese Yuan amid favorable fundamental headwinds.
China's zero-Covid policy has been weighing on local economic output. Meanwhile, rising fears of a recession in the US are slowly weakening global growth expectations. This leaves China in a tricky spot, even if conditions open up locally. A slowing global economy could sap the demand for Chinese goods. Diverging monetary policy is also favoring the US Dollar against the Chinese currency.
On the daily chart, USD/CNH has left behind a bullish Morning Star candlestick pattern. Further upside follow-through could open the door to further gains. That would place the focus on the May high at 6.8376.
Otherwise, clearing immediate support at 6.6480 exposes the Mat low at 6.6119 as the 50-day Simple Moving Average nears.
USDCNH Update - Major Breakout UnderwayIf you bought this pair when I first featured it here, you have made money. If you were leveraged 50:1 - which - often is the case in forex, you have likely returned more (% returned) in this trade than what you can expect in three years of investing in a vanilla benchmark-tracking 401K.
I remain long USDCNH and will continue to cover it for the foreseeable future.
Something to consider: such a rapid deterioration of the Yuan is reason to speculate the Chinese economy is becoming increasingly decoupled from anything that resembles the last 10-12 years of price action. For example, if the Yuan were to surpass $7.20, I would start to suspect two possible (again I can't "predict" anything) situations:
1. The Chinese economy in severe distress (hopefully not).
2. Intentional disregard for participation in the global economy, as it exists currently (hopefully not).
Again, we are not there YET; all we can do is read the chart and analyze information / data as it becomes available.
Pray for peace.
God Bless
Monthly CNHUSDZooming out to the monthly CNHUSD which represents offshore yuan, we have clearly had an exit from the downtrend that has been in place for close to a decade. The big question is, what's next? Right now, I'm seeing the CNH drop out of a rising wedge to potentially retest the downtrend and/or the 72/89 EMA cloud. I've drawn out my best guess on what a retest would look like. Likely a pull back that translates to sideways consolidation on the 72/89 EMA cloud, and then a rally up.
This chart is more interesting from more of the global implications perspective. Will China devalue again as they did in 2015? If the bull scenario plays out here, what would cause a significant increase in demand of CNH and CNY?
Keeping this macro chart on the list of things to watch.
USDCNY 25th APRIL 2022USDCNY still under bullish pressure. Currently, China has shown signs of implementing a new normal, but its economic growth is not as aggressive as before the pandemic.
13 Chinese cities have been in total lockdown since March, and several others have been in partial lockdown.
The Chinese government reported that there were around 15,000 confirmed cases of Covid-19 nationwide in March.
USDCNH D1 - 17th MARCH 2022
Although the current slowdown in China's economy has not had much impact on Indonesia in the short term,
However, it must be anticipated in the long term. Especially at this time commodity prices are also experiencing an increase.
USDIDR WEEKLY - APRIL
The Beginning of the Golden Dragons Collapse?China is struggling, Covid 3.0 or whatever version we are on now is taking a hold of the Chinese, Shanghai in lockdowns and Shipments struggling to dock. The Chinese Economy is in a very interesting position currently, with Companies like the Chinese Titanic 'Evergrande' defaulting. We are seeing China try to expand its influence in the SCS ( South China Sea). When we take a look at the currency pair USDCNH, we are seeing the USD start to gain some real ground and this weekly charts shows the potential for this rally to continue to the 7 area, we can look for a retest of volume before opening potential long positions.
