Yuan in standby mode
Date of publication: 07 February 2019
Starting from Monday to this day in China there are exchange weekends associated with the new year on the lunar calendar, and rest in China will be until the end of this week.
Saidova Zarina, senior analyst of Department of the analysis of world markets. FINAM
Last week, the yuan showed mixed dynamics against the dollar-in the middle of the week it strengthened due to the fact that the us currency was under strong pressure from the "pigeon" results of the fed meeting, and at the end of the week the yuan fell amid the recovery of the dollar against the background of successful us labor market data for January.
As for the Thomson Reuters/HKEX Global CNY Index (RXYY) (for reference: its basket includes AUD, CAD, CHF, EUR, GBP, HKD, JPY, KRW, MYR, NZD, RUB, SGD, THB and USD), it showed mixed dynamics over the last week, but in General, the trend towards strengthening continues.
While the holidays continue in China, and trading on the USD/CNY pair will not enter into a normal mode, the currency market players will continue to monitor the events on the front of the us-Chinese foreign trade negotiations to lay the incoming news in the dynamics of the pair next week.
The rate is adjusted to the long-term uptrend line and in the short term retains the potential for moderate drawdown within the specified line.
On the daily chart, in accordance with our expectations, the "round top" continues to form, within which it will be logical to expect a further measured drawdown of the course.
TR/HKEX Global CNY Index
On the daily chart of the index, there was an upward exit from the multi-month consolidation phase, which is why the potential for strengthening in the short term remains.