USD/CNY to extend its race higher after completing a base – Credit Suisse

USD/CNY has surged higher this week. Analysts at Credit Suisse look for a deeper rise, which could reinject momentum into the broader USD trend.

Sharp move higher in USD/CNY to provide a renewed impetus for the broader USD trend

“USD/CNY has now broken above the 200-day moving average at 6.4034, which confirms a base and a medium-term turn higher. Next key resistance is seen at the July 2021 high and 23.6% retracement of the entire fall from at 6.5121/25, which we believe will be tested over the coming weeks. Next resistance above here is seen at the April 2021 high at 6.5759.” 

“So far, the USD has appreciated strongly against other G10 currencies over the past year, whilst USD/CNY has stayed rangebound. A sharp move higher in the latter could provide a renewed impetus for the broader USD trend.”