The USDCNH formation hints to a cycle degree a-b-c zigzag, currently in wave b.
Cycle degree wave a took the form of a 5-wave impulse upon completion. We then saw the development of a bearish correction which hints at a simple zigzag Ⓐ-Ⓑ-Ⓒ formation in the primary degree.
Wave Ⓐ has been completed and we are now in the initial stage of correction wave Ⓑ.
Wave Ⓑ could lead prices to 7.051. At that level, wave Ⓑ will be at 50% of wave Ⓐ.
An alternative scenario suggests that cycle wave b is a double Ⓦ-Ⓧ-Ⓨ zigzag.
At the time of writing, primary wave Ⓨ is taking the form of a simple (A)-(B)-(C) zigzag. Wave (A) of Ⓨ has been completed, whereas wave (B) has just begun to form.
In the medium term, wave (B) could reach the 6.968 area. At that level, it will be equal to 50% of wave (A).
After the correction, we could see a bearish move towards the 6.866 area. At that level, primary wave Ⓨ will be at 76.4% of wave Ⓦ.