Yuan Rates
USDCNH Daily
Prepared by Michael Boutros.
USDCNH cleared a multi-week consolidate range last week with the rally breaking through down-trend resistance extending off the yearly high and the 61.8% extension of the advance off the yearly low at 6.8736. Note that the move was accompanied by a resistance trigger-break in momentum and keeps the focus higher while above confluence support at 6.8548/90 where the monthly open & the December low converge on basic trendline support extending off the May 2016 low & the 100-day moving average (bullish invalidation).
Interim resistance is seen just higher at the 61.8% retracement of the yearly range at 6.9086 and is backed by the 100% extension at 6.9255. IF this rebound is corrective, topside advances should be capped by this threshold. Critical resistance stands with the 2017 high-day close, which converges on slope resistance at 6.9582. From a trading standpoint, I’d be looking to fade weakness into structural support with a breach above the upper parallel needed to mark resumption of the broader uptrend
Market News
China’s Premier Li Keqiang released the government work report at China’s National People’s Congress annual conference on Sunday.
The 2017 economic growth target came in line with expectations, at 6.5%.
Inflation and fiscal deficit ratio targets were held unchanged compared to 2016.
Economic Targets Released in the Annual Government Work Report
2017
2016
2015
2014
2013
GDP growth
6.5%
6.5%-7.0%
7.0%
7.5%
7.5%
Inflation
3%
3.0%
3.0%
3.5%
3.5%
Fiscal bal. of GDP
-3.0%
-3.0%
-2.3%
-2.1%
-2.0%
Fiscal bal. (trillion yuan)
-2.38
-2.18
-1.62
-1.35
-1.20
