USD/CNH has advanced steadily and last...>

CHINA YUAN: USD/CNH has advanced steadily and last changes hands +454 pips at

CNH7.1270. The greenback remains bid as participants hunt for safety, while

China (alongside many other countries in the region) observes a public holiday.

- The BBG story we have just flagged is likely helping the rate higher. The

report notes that U.S. Pres Trump "is exploring blocking a government retirement

fund from investing in Chinese equities considered a national security risk".

- Continued and escalating public U.S.-China sabre rattling provides another

factor pushing the rate higher, as multiple market closures across the Asia-Pac

region limit the news flow, leaving Sino-U.S. tensions at the fore.

- Bulls look for further gains past Apr 2 high of CNH7.1423. Above there would

open CNH7.1653, a cycle high printed on Mar 19. Bears need a retreat under the

50-DMA at CNH7.0556, which would give them a green light for targeting Apr 10

low of CNH7.0370, a key near-term support.

- China returns from holidays next Wednesday. Thursday will see the release of

Caixin Services and Composite PMIs and trade balance, while flash BoP current

account balance hits the wires on Friday.