The Asian Dollar Index continues to.....>

DOLLAR-ASIA: The Asian Dollar Index continues to press against support at its

200DMA, pressured by the ongoing rally in the USD globally. With the US dollar

showing no signs of reversing its bullish trend vs EM FX, even after the recent

drop in bond yields, the ADXY looks increasingly likely to break support. 

- Despite its weakness vs the USD, the ADXY is testing its strongest ever level

relative to the JPMorgan EM FX index, a diversified basket of EM currencies,

largely thanks to the reliance of the Chinese yuan, but pressure is mounting on

the redback. 

- Given the importance of the CNY in keeping the ADXY relatively stable over

recent weeks, any yuan weakness would remove a major pillar of support for the

ADXY, causing it to slice through support.