EURUSD hits target before USD catches a bid

Stuart Cowell HFM

EURUSD, H1

EURUSD triggered a Long position at 08:00 for 9 pip gain before reversing into a USD bid on Bloomberg reports of the PBOC is evaluating potential impact of a gradual CNY depreciation. Senior Chinese officials are studying a two-pronged analysis of the yuan; First part looks at the effect of using the currency as a negotiation tool with the US, second part looks at what would happen if China depreciates the yuan to offset any trade impact. Risk sentiment improved as the Asia session progressed, despite the ratchetting-up in geopolitical tensions following the alleged chemical attack in Syria. Japan’s Nikkei 225 closed with a 0.5% gain and S&P 500 futures were also showing a 0.7% advance, reversing some of the 2.2% closing loss the cash index saw in regular Wall Street trade on Friday. The improved risk sentiment was in part sparked by news that U.S. officials said that North Korea wants to discuss denuclearization, while there are also expectations for Chinese premier Xi to deliver a market-soothing speech at tomorrow’s Boao Forum. Xi is widely anticipated to announce major economic reforms, including Trump-mollifying measures to aimed at opening up and increasing foreign access to its domestic market.

European equity markets have opened in positive territory following on from gains in Asia, UK100 trades at 7200 and the GER30 at 12,340

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Author

Stuart Cowell

HFM

With over 25 years experience working for a host of globally recognized organisations in the City of London, Stuart Cowell is a passionate advocate of keeping things simple, doing what is probable and understanding how the news, c

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