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May 24, 2013
Flash: USD/CNY has a bearish bias – BTMU
FXstreet.com (Barcelona) - Bank of Tokyo Mitsubishi UFJ analysts believe that USD/CNY has a bearish bias and is set to range between 6.1250 and 6.1750.
They feel that once again the offshore enthusiasm for onshore CNY led USD/CNY to break the lower boundary of an indicative 1-week trading range (by -45pips this time). They write, “It’d be easy for us to become tedious saying the same thing most every week, and from a trader’s point of view it stands to reason at some stage this one-way journey down of USD/CNY has to be punctuated with a break here and there (as was the case for USD/JPY). USD/CNH is hugging closer to USD/CNY, a sign of the trader concerns elucidated above.” Continuing, the note that the first flash manufacturing PMI for May indicated a recovery that may be stalling and in need of more fiscal love, but there’s nothing that appears to have changed with the direction nor pace of capital flows. And the currency has not traded much to macroeconomics this year. Bottom line: another week of a bearish bias
They feel that once again the offshore enthusiasm for onshore CNY led USD/CNY to break the lower boundary of an indicative 1-week trading range (by -45pips this time). They write, “It’d be easy for us to become tedious saying the same thing most every week, and from a trader’s point of view it stands to reason at some stage this one-way journey down of USD/CNY has to be punctuated with a break here and there (as was the case for USD/JPY). USD/CNH is hugging closer to USD/CNY, a sign of the trader concerns elucidated above.” Continuing, the note that the first flash manufacturing PMI for May indicated a recovery that may be stalling and in need of more fiscal love, but there’s nothing that appears to have changed with the direction nor pace of capital flows. And the currency has not traded much to macroeconomics this year. Bottom line: another week of a bearish bias