Forex: US Dollar Finally Shows Strength Against Chinese Yuan

Finally a break of the four month trading range has occurred with this currency pair, the USD finally showing more strength than at any time in the past year, with a break out to the upside.

The next significant resistance is between 6.9240 – 6.9490.

The market gapped up over my previous R1, which is now support at S1 on the chart. The gap up and not yet closed, shows a potentially important degree of USD strength.

TECHNICALS

Li’s Sandwich Indicator, previously defining resistance quite well, has now been penetrated and shows an over bought condition.
Stochastic – registering over bought but not yet retreating drastically from the resistance area.

R1 – 6.8772
R2 – a resistance zone between 6.9240 – 6.9490.
S1 – 6.8386.

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Article and Commentary by Don Schellenberg. A trader and trading coach, he is a noted expert on Market Structure, Elliott Wave and Fibonacci. He trades the forex market.

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