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CNH: USD/CNH Near 7.2400, 200-day MA Support Held, Less Cross Asset Support

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USD/CNH's Wednesday rebound ran out of steam at 7.2500 late in Asia Pac trade. We saw some volatility through the US CPI print, but sit near 7.2400 in early Thursday dealings. Yesterday's lows at 7.2157 saw a brief dip sub the simple 200-day MA (7.2220). CNH ended up losing a modest 0.20% for Wednesday's session. The DXY rose by a similar amount, but the BBDXY index was close to unchanged.

  •  Spot USD/CNY finished at 7.2379 for Wednesday's session. The CNY CFETS basket tracker edged down slightly to 98.77 (per BBG), continuing its recent downtrend.
  • Current USD/CNH spot levels rest near the 200-day EMA, while the 20 and 100-day EMA upside resistance points rest near 7.2600. We probably need to move back above this level to unwind some of the downside technical bias in the pair. Since the start of March USD/CNH rebounds have been progressively lower than prior episodes.
  • Cross asset trends for CNH were a little less supportive through Wednesday trade. Onshore equities finished up down -0.36%, while in US trade the Golden Dragon index lost 1.21%. US equities also recovered modestly.
  • US Tsy yields also finished firmer in the wash up of the mixed CPI report (softer headline but still some hawkish details). US-CH yield differentials have recovered some ground, although focus remains on onshore CGB yields. The 10yr is back around 1.85% but has been quite volatile this week (highs of 1.95% per BBG). Uncertainty around the PBoC easing outlook and likely greater debt supply impacting sentiment in this space.
  • On the data front, we still await Feb new loans and aggregate finance figures. Feb FDI is also due between now and 18th March. 
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USD/CNH's Wednesday rebound ran out of steam at 7.2500 late in Asia Pac trade. We saw some volatility through the US CPI print, but sit near 7.2400 in early Thursday dealings. Yesterday's lows at 7.2157 saw a brief dip sub the simple 200-day MA (7.2220). CNH ended up losing a modest 0.20% for Wednesday's session. The DXY rose by a similar amount, but the BBDXY index was close to unchanged.

  •  Spot USD/CNY finished at 7.2379 for Wednesday's session. The CNY CFETS basket tracker edged down slightly to 98.77 (per BBG), continuing its recent downtrend.
  • Current USD/CNH spot levels rest near the 200-day EMA, while the 20 and 100-day EMA upside resistance points rest near 7.2600. We probably need to move back above this level to unwind some of the downside technical bias in the pair. Since the start of March USD/CNH rebounds have been progressively lower than prior episodes.
  • Cross asset trends for CNH were a little less supportive through Wednesday trade. Onshore equities finished up down -0.36%, while in US trade the Golden Dragon index lost 1.21%. US equities also recovered modestly.
  • US Tsy yields also finished firmer in the wash up of the mixed CPI report (softer headline but still some hawkish details). US-CH yield differentials have recovered some ground, although focus remains on onshore CGB yields. The 10yr is back around 1.85% but has been quite volatile this week (highs of 1.95% per BBG). Uncertainty around the PBoC easing outlook and likely greater debt supply impacting sentiment in this space.
  • On the data front, we still await Feb new loans and aggregate finance figures. Feb FDI is also due between now and 18th March.