Forex Recap – USD/CNY Heads Up amid Downbeat Chinese Trade Data

The June US YoY Producer Price Index (PPI) that excludes Food and Energy reported a 0.1% rise over estimates. The robust 108.65 resistance acted as the robust barrier, disallowing any further arouses in the Ninja.
Nikhil Khandelwal
Flags of USA and China with Franklin and Mao faces.

USD/CNY

The Chinese Yuan fell drastically following weak June Trade data on Friday. Notably, the Chinese Export figures reported lower as a result of Trump’s tariff impositions. The shrink in the June Import data, reporting -7.3% over -4.5% forecasts, shocked the market participants.

USDCNY 180 Min 12 July 2019

In the meanwhile, the USD/CNY pair was forming a symmetrical triangle pattern which restricted pair’s upside. Today, the Relative Strength Indicator (RSI) indicator displayed a 19 point rise since opening, revealing buyer interest. A triumphant march to the north, breaking the short-term SMA confluence was quite noticeable. However, any additional growth above the symmetric triangle would have enabled the pair to challenge the significant 200-day SMA. Another critical barrier preventing the pair’s upliftment was the strong 6.8821 resistance.

USD/JPY

The Japanese Yen pair had already broken the major counter trendline earlier this month. Anyhow, the strong 108.98 resistance had discouraged the bulls, cutting off the potential breakout. After heading southwards for quite some time, the USD/JPY pair had revolted back yesterday. However, the robust 108.65 resistance acted as the robust barrier, disallowing any further arouses. Today, the USD/JPY pair showcased the adverse rebound price action after hitting the aforementioned resistance.

USDJPY 240 Min 12 July 2019

Earlier the day, the Japanese May Industrial Production data published some disappointing reports. Both the MoM and YoY, Production reports missed the market expectations. The YoY Industrial data came around -2.1% over -1.8% consensus estimates. Anyhow, the low significant May Capacity Utilization reported slightly better figures. The Capacity Utilization data reported 1.5% higher than the street hopes of around 0.2%.

USD Index

Earlier the month, a 14-day old ascending slanting resistance confined Greenback’s positive drifts. However, after multiple failed attempts, the USD Index appeared to take the downward path. Today, this negative trend seemed to pause, forming a symmetrical triangle pattern. Anyhow, later the day, this pattern started playing its role, indicating downfall continuation.

US Dollar Index 120 Min 12 July 2019

On the back of upbeat US data, the US Dollar Index maintained an overall seesawed performance on Friday. The June YoY Producer Price Index (PPI) that excludes Food and Energy reported a 0.1% rise over estimates. Meantime, at around 14:00 GMT, Fed’s Evan’s dovish comments on the US economic outlook, entertained the bears.

EUR/USD

Two days back, the Fiber had made a superb breakout through the major counter trendline1. Since yesterday, the EUR/USD pair was struggling to make another breakout happen from counter trendline2. Today, the pair continued to make unsuccessful efforts, highlighting the importance of the counter trendline2. Even if the pair had broken this aforementioned resistance, the significant 200-day SMA would have limited such immediate advances. While on the downside, the 50-day short-term SMA acted as a firm cushion for any potential dips.

The most crucial May Eurozone Industrial Production data release pleased the bulls. The market had expected the MoM Industrial Production to report 0.2% over the previous -0.4%. Quite surprisingly, the actual figures reported 0.7%, luring the buyers. Earlier today, the June Spain HICP and Consumer Price Index recorded in-line with the market hopes. However, the low volatile German June Wholesale Price Index recorded well below the street estimates. The MoM Wholesale Price Index reported -0.5% over 0.2% expectation.

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