- Recently sluggish data from China outweighs early-week benefits signaled through trade ceasefire.
- A slew of second-tier US statistics and news headlines will be on the stoplight.
Having witnessed another blow from the economic calendar, in terms of Caixin Services PMI, USD/CNH extends its previous recovery to 6.8907 during early Wednesday.
Be it official readings from NBS or Caixin data, China’s headline purchasing managers’ index (PMI) has been disappointing off-late. The recent one includes Caixin Services PMI for June that lagged below 53.0 forecast to 52.0, testing the lowest levels since February.
Also weighing on China’s currency could be lack of progress at trade front despite the positive outcome of the G20 meeting between the US and Chinese leaders.
On Tuesday, CNBC quoted the White House Trade Adviser Peter Navarro as raising doubts over the recently agreed trade truce between the world’s two largest economies. The same could also be considered as an extra negative for China.
With the second-tier US data concerning ADP Employment Change, Trade Balance and Factory Orders up for release, investors might not miss the outcome for fresh directions while keeping an eye over the trade headlines.
Technical Analysis
A sustained break of 6.9000 comprising 21-day simple moving average (21-DMA) becomes necessary for the pair to aim for 6.9155 failing to provide the same can fetch quote back to 200-day simple moving average (200-DMA) level of 6.8369.
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