China's 10y govt yield drops 5bps to 2.85% amid bets on RRR cut

Ross J Burland FXStreet

China may lower the RRR as soon as this month, according to the Securities Daily.

As a consequence, China's 10-year govt yield dropped 5bps to 2.85% today and USD/CNH is firm in the open on Monday trading between 6.3690 and 6.3752 the high.

The recovery in AUD/USD is stalling as well and the US dollar is higher by some 0.13% on central bank divergence themes.

AUD/USD H1 chart

The above analysis acknowledges the risks on the downside but also the potential for bulls to move in at the neckline of the hourly W-formation. This could result in a continuation of the correction to test old support near a 61.85 Fibonacci retracement of the last bearish hourly impulse.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

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