USD/CNH is extending three-day losing streak

• The offshore yuan is pushing higher against the greenback, having posted gains in the last three trading days.
• The PBOC set the yuan reference rate at 6-month highs.

The USD/CNH pair is currently trading at 6.7425 - down 0.25 percent on the day.

The Chinese currency picked up a bid seemingly after the People's Bank of China (PBOC) set the daily reference rate at 6.7560 - the strongest fix since July 19, 2018.

Notably, the CNH posted gains for the third straight day on Friday and jumped more than 1 percent last week, triggering speculation that China may be allowing its currency to appreciate in order to clear the way for a trade deal.

Looking forward, the bid tone around the CNH will likely strengthen if the China trade data, due later today, shows a drop in the trade surplus with the US. Also, the Sino-US trade optimism and the dovish Fed expectations could keep the USD/CNH pair under pressure.

USD/CNH Technical Levels