Preparing for US-China trade negotiations and publication of statistics
In this review, we suggest considering the personal composite instrument (PCI) CNHRUB. It reflects the price dynamics of the Chinese yuan against the Russian ruble. Will the CNHRUB rise?
Such a movement on the chart is observed in case of the weakening of the ruble and strengthening of the yuan against the US dollar. A significant positive factor for the Chinese currency may be Vice-Premier Liu He’s visit to the United States for trade negotiations on May 9. Earlier, these negotiations were in question because of US President Donald Trump’s statement about plans to increase duties on Chinese goods. Amid this, on Monday, the yuan fell to the 3.5-month low against the US dollar, but now it has started to recover gradually. Important macroeconomic data on inflation and China’s trade balance for April may affect its exchange rate. They will be released on May 8-9. In turn, the decline in world oil prices, as well as plans of the Central Bank of the Russian Federation to ease the monetary policy have a negative impact on the Russian ruble exchange rate. Inflation in Russia is 5.2% year over year, and the rate of the Central Bank is at a noticeably higher level of 7.75%.
On the daily timeframe, CNHRUB: D1 is in a downtrend, but it has approached its resistance line. Before opening a buy position, the CNHRUB should breached it up. A number of technical analysis indicators formed buy signals. The further price increase is possible in case of positive macroeconomic and political data from China and statements about a rate cut by the Central Bank of the Russian Federation.
Summary of technical analysis
Position Buy
Buy stop Above 9.72
Stop loss Below 9.45
In this review, we suggest considering the personal composite instrument (PCI) CNHRUB. It reflects the price dynamics of the Chinese yuan against the Russian ruble. Will the CNHRUB rise?
Such a movement on the chart is observed in case of the weakening of the ruble and strengthening of the yuan against the US dollar. A significant positive factor for the Chinese currency may be Vice-Premier Liu He’s visit to the United States for trade negotiations on May 9. Earlier, these negotiations were in question because of US President Donald Trump’s statement about plans to increase duties on Chinese goods. Amid this, on Monday, the yuan fell to the 3.5-month low against the US dollar, but now it has started to recover gradually. Important macroeconomic data on inflation and China’s trade balance for April may affect its exchange rate. They will be released on May 8-9. In turn, the decline in world oil prices, as well as plans of the Central Bank of the Russian Federation to ease the monetary policy have a negative impact on the Russian ruble exchange rate. Inflation in Russia is 5.2% year over year, and the rate of the Central Bank is at a noticeably higher level of 7.75%.
![07-05-2019.png](/forum/proxy.php?image=https%3A%2F%2Fifccd.net%2Fuploads%2Fimage%2F07-05-2019.png&hash=be379d01f6ea1f021f4fea0d55f4dc5c)
On the daily timeframe, CNHRUB: D1 is in a downtrend, but it has approached its resistance line. Before opening a buy position, the CNHRUB should breached it up. A number of technical analysis indicators formed buy signals. The further price increase is possible in case of positive macroeconomic and political data from China and statements about a rate cut by the Central Bank of the Russian Federation.
- The Parabolic Indicator gives a bullish signal.
- The Bollinger bands have narrowed, which indicates high volatility. The lower Bollinger band is titled upward.
- The RSI indicator is below 50. It has formed a positive divergence.
- The MACD indicator gives a bullish signal.
Summary of technical analysis
Position Buy
Buy stop Above 9.72
Stop loss Below 9.45