Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
A hammer candlestick charted by CSI 300 on Aug 12 turned focus to the topside and the subsequent bullish engulfing candlestick pattern heralded a jump to best levels in one month, which was accompanied by a bounce in volume. However, the index failed to test its YtD highs and eased off thereafter. It continues to move towards the apex of an ascending triangle and a break above Jul 13/YtD high of 4,878 would send a clear bullish signal, opening up the psychological 5,000 level. With the 50-DMA still above the 100-DMA and then the 200-DMA, with all three heading higher and with gaps between them widening, bulls are on the lookout for any catalysts which could put a fresh bid into the index, helping it challenge YtD highs. Conversely, bears need a close under the 23.6% retracement of the May 25 - Jul 13 rally at 4,624 before targeting the 38.2% retracement of the aforementioned range at 4,466, which has proven resilient over the last 1.5 month or so.
- One obvious thing to watch are Sino-U.S. trade matters, as a glimmer of hope that any worst-case scenario can be averted remains, amid the continued escalation in broader Sino-U.S. geopolitical tensions. Washington and Beijing repeatedly confirmed that the recent delay to the review of their phase-one trade deal was due to scheduling issues and they plan holding talks in the near future, with White House's Kudlow noting that the U.S. is very satisfied with progress on bilateral trade matters.
- That being said, there is a looming risk of deterioration in bilateral trade relations, given the spiralling tensions re: Hong Kong, Taiwan, Chinese tech giants, diplomacy or human rights issues.
- The move to a fresh one-month high described in the opening lines, occurred as the PBoC conducted a generous injection of CNY700bn via MLF, which outweighed maturing operations. The central bank's willingness to continue to pump liquidity into the system will be another factor to watch.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.