For the second day in a row, the CNY fixation was much stronger than expected. USD/CNH was last at 7.2596, according to OCBC FX analysts Frances Cheung and Christopher Wong.
Bullish momentum on the daily chart
“Monetary policymakers are trying to convey a message that the recent USD/CNH move is close to testing policymakers’ tolerance threshold for CNH weakness.
“On the one hand, the strong fix may serve as a deterrent against further weakening of the RMB, but on the other hand, Trump’s trade boost may mean that USD/CNH remains better bid on dips. Given the strong USD trend, monetary policy makers can only slow down the pace of RMB depreciation at best.”
“For USD/CNH to reverse the trend, USD needs to relax. Bullish momentum on daily chart remains intact while RSI is near overbought conditions. Resistance at 7.2750 levels. Support at 7.22, 7.20 (200 DMA ).”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
