Chinese Yuan trades marginally lower as CPI data misses expectations
- USD/CNY is currently trading around 6.5295 marks.
- It made intraday high at 6.5345 and low at 6.5230 levels.
- Intraday bias remains slightly bullish till the time pair holds key support at 6.4973 mark.
- A sustained close above 6.5262 marks will test key resistances at 6.5333, 6.5585, 6.5749, 6.6050 and 6.6210 marks respectively.
- Alternatively, a daily close below 6.5262 will drag the parity down towards key supports at 6.4973, 6.4732, 6.4535, 6.4426 and 6.4355 marks respectively.
- PBOC sets yuan mid-point at 6.5207/ dlr vs last close 6.5285.
- Important to note here that 20D, 30D and 55D EMA heads down and confirms the bearish trend in a daily chart. Current upside movement is short term trend correction only.
- China sets yuan mid-point at weakest level since Dec 29, 2017.
- China Dec PPI y/y decrease to 4.9 % (forecast 4.8 %) vs previous 5.8 %.
- China Dec CPI y/y increase to 1.8 % (forecast 1.9 %) vs previous 1.7 %.
- China Dec CPI m/m increase to 0.3 % (forecast 0.4 %).
We prefer to take long position on USD/CNY around 6.5275, stop loss 6.4973 and target of 6.5585.
Source: FXWire Technicals