USD/CNH 1H Chart: Falling Wedge

24 lug 2017

The USD/CNH currency pair has formed a falling wedge. The given pattern has already provided three confirmations on each side and is gradually approaching its ending point. The rate entered the wedge from below, suggesting that a breakout, expected to occur somewhere near the end of July, should be due to the upside. However, technical indicators in both shorter and longer terms favour the prevalence of bearish sentiment that could push the rate lower. By and large, the Greenback is likely to trade sideways or slightly higher in the remaining trading hours. The closest level of importance is a resistance cluster formed by the 55– and 100-hour SMAs circa 6.7570 that coincides with the upper boundary of a junior channel down. Subsequently, the rate may respect the boundaries of this minor channel until the lower wedge boundary is reached.