USD/CNH: Modestly flat above 50-D EMA ahead of China trade balance data


  • USD/CNH is chopped between the US-China trade stalemate and Fed’s dovish bias.
  • China trade balance can offer fresh impulse followed by the US PPI.
  • 50-D EMA limits immediate downside while 6.9000 holds the upside capped.

With the Fedspeak continuous to weigh over the US Dollar (USD) and uncertainty surrounding the US-China trade deal keeps growing, the USD/CNH pair traders modestly flat near 6.8745 during early Friday.

The US Federal Reserve Chairman, Jerome Powell, held his bearish bias during the second day of Testimony where he cited concerns of weak inflation likely dragging for long. Following the suit were some of the key Federal Reserve officials like New York President John Williams and President of the Federal Reserve's Minneapolis branch Neel Kashkari.

The US President Donald Trump conveyed his disappointment from the Chinese act of not importing more of the US farm products even after promising at the G20. On another hand, Chinese media spot key US diplomats to being envious to the dragon nation.

Investors await June month trade data from China for fresh direction amid headlines signaling less likeliness of a trade deal between the world’s two largest economies. Forecasts suggest Trade Balance number to rise from $41.65 billion to $44.65 billion with an expected improvement in imports to -4.5% from -8.5% contrasting with likely slump in exports to -2.0% versus 1.1% prior.

Following that, the US Producer Price Index (PPI) data for June will be the key to follow. Headline PPI number bears the consensus to soften to 0.0% and 1.6% from 0.1% and 1.8% respectively on a monthly and a yearly basis. Further, PPI ex Food and Energy could decline to 2.2% from 2.3% on a YoY format while likely remaining unchanged to 0.2% on a MoM basis.

Technical Analysis

A sustained break of 6.8728 comprising 50-day exponential moving average (50-D EMA) can fetch prices to 6.8600 and 6.8430 ahead of pushing bears towards current month low near 6.8166. Meanwhile, pair’s rise past-0.9000 mark, close to multiple tops marked during the month, can propel prices to 6.9160 and 6.9400 during the further rise.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD registers an inside day ahead of German Zew survey

EUR/USD created an inside day or inside bar candlestick pattern on Monday, indicating investor indecision and impending volatility. An inside day occurs when the price action falls within the preceding day's high and low. On Monday, 

EUR/USD News

GBP/USD: Inside day makes Tuesday's close pivotal

GBP/USD created an inside bar candlestick pattern on Monday, making Tuesday's GMT close pivotal. An inside bar occurs when the daily high and low falls within the preceding day's trading range. The pair hit a high at 1.2650.

GBP/USD News

USD/JPY unchanged on 108 handle in Tokyo opening hour, eyes on key events

USD/JPY is steady in Tokyo's opening hour, down -0.02% despite the concerns over the 'Phase1' deal made between China and the US on Friday. Looking ahead, eyes are on US Industrial Production and Fed speakers.

USD/JPY News

Gold: Bears look for a break below the trendline support

The price had been sent lower below the 21 and 50-day MA converging and the 7th Oct lows. Trendline support guards a test of a 50% mean reversion of the late June swing lows to recent highs around 1480 will be encouraged. 

Gold News

UK jobs report preview: GBP/USD set to react to figures that go with the Brexit mood

Finding a job in the UK is more accessible than in the past and pay is rising – but that does not move the pound these days. The employment report is scheduled two days ahead of the critical EU Summit and 16 ahead of Brexit Day. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures