USD/CNH: Mildly bid even though US softens demand in the China trade deal
- USD/CNH is reporting mild gains above 6.70 at press time amid improved risk appetite.
- The US has toned down China demands in the trade deal, as a result, CNH weakness could be short-lived.
USD/CNH is reporting mild gains near 6.71 at press time, despite the news that the US has toned down China demands in a sign of true compromise in trade talks.
The US negotiators have tempered demands that China curb industrial subsidies as a condition for a trade deal after strong resistance from Beijing, according to a Reuters report. The news seems to have boosted the already improved risk appetite in the financial markets.
As of writing, the major Asian equity markets are flashing green with Japan's Nikkei trading at the highest level since Dec. 4. The Shanghai Composite index is currently up 1.5 percent on the day.
So far, however, the renewed trade optimism has failed to put a bid under the Chinese currency. That said, the technical charts are still biased bearish. Notably, the repeated failure at the downward sloping (bearish) 50-day moving average (MA) seen over the last two weeks favors a re-test of the recent low of 6.67.
USD/CNH Technical Levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
