• USD/CNH drops for the second consecutive month, on a slippery ground of late.
• Bearish MACD, one-year-old falling trend line favor sellers.
• February’s low guards immediate upside before the support-turned-resistance line.

USD/CNH bears cheer a clear downside break of the key support line around a three-year low, down 0.48% near 6.3825 ahead of Wednesday’s European session.

Not only the trend line breakdown but bearish MACD and the pair’s sustained trading below 61.8% Fibonacci retracement of 2014-2019 upside, as well as sustained follow of the downward sloping trend line from May 2020, also favor USD/CNH traders.

However, the October 2015 bottom surrounding 6.3150 and the 6.3000 psychological magnet can test the sellers ahead of directing them to 2018 low close to 6.2360.

Meanwhile, corrective pullback needs to cross February’s low of 6.4008 before battling with the previous support line near 6.4020.

Also acting as the crucial hurdle to the north are the 61.8% Fibonacci retracement level and the yearly falling resistance line, respectively around 6.4670 and 6.5380.

Overall, the USD/CNH south-run is just in its infancy but intermediate bounce can’t be ruled out.

USD/CNH MONTHLY CHART