USD/CNH pressures key 7.16 support – Société Générale

USD/CNH remains under pressure after surrendering its 50-DMA in May, with bearish momentum persisting. The pair is testing key support at 7.16, and a decisive break lower could open the door to deeper losses toward 7.13 and 7.10, Société Générale's FX analysts note.

The phase of downtrend may extend

"USD/CNH gave up the 50-DMA in May resulting in a steady decline. The down move tentatively stalled after carving out an interim low near 7.16. The pair is now challenging this support. If USD/CNH establishes below 7.16, the phase of downtrend may extend."

"Next objectives could be located at 7.13 and the ascending trend line drawn since 2023 at 7.10/7.09. Cross above the MA at 7.20/7.21 is crucial for confirming a short-term up move."