USD/CNY forecast as China’s trade surplus soars to $90 billion

    The USD/CNY exchange rate drifted upwards on Tuesday after the latest China trade numbers. The Chinese yuan crashed to 6.9244, the lowest point since April 27th of this year. In all, the yuan has fallen by over 3% from the highest level in March.

    China trade numbers

    The biggest CNY news was the latest trade numbers from China. According to the statistics agency, the country’s exports rose by 8.5% in April after jumping by 14.8% in the previous month. That increase was better than the median estimate of 8.0%. In a note, an analyst at JP Morgan said:

    “If we look at the exports statistics, we’re seeing very significant and ahead-of-expectation strength coming out of the export sector. That’s counter to what we’re seeing particularly out of tech exports in Korea and Taiwan, and it’s very clear evidence that there’s not a lot of decoupling actually going on on the ground.”

    Meanwhile, China’s imports dropped at a faster pace than expected. In all, exports dropped by 7.9% in April, which was worse than the median estimate of 5.0%. It was also worse than the previous decline of 1.4%. As a result, China’s trade surplus jumped to $90.21 billion from the previous $88.19 billion.

    In all China’s economy has recovered at a slower pace than what analysts were expecting. This is evidenced by the earnings report of leading American companies. Most of them like Estee Lauder and P&G have lamented that China’s recovering is happening at a relatively slower pace than what analysts were expecting.

    The next key USD/CNY news will be the upcoming US consumer price index (CPI) data scheduled for Wednesday this week. These numbers will provide more information about the state of the American economy and what to expect from the Fed.

    USD/CNY technical analysis

    USDCNY chart by TradingView

    The USD/CNY exchange rate rose slightly after the latest trade numbers. On the 4H chart, the pair moved slightly above the 25-period and 50-period exponential moving averages. Further, the Relative Strength Index (RSI) and the MACD have all drifted upwards. The USD to CNY exchange rate has risen above the key resistance point at 6.9060, the highest point on March 30.

    Therefore, the pair will likely continue rising as buyers target the next key resistance point at 6.9430, the highest level on April 26th. The stop-loss of this trade will be at 6.900.

    The post USD/CNY forecast as China’s trade surplus soars to $90 billion appeared first on Invezz.

    Stay in the Loop

    Get the daily email from CryptoNews that makes reading the news actually enjoyable. Join our mailing list to stay in the loop to stay informed, for free.

    Latest stories

    - Advertisement - spot_img

    You might also like...