Chinese Extended 1.11 Trillion Yuan
China’s yuan edged up against the dollar on Wednesday, with the market unfazed by evidence of a still-solid economy and divided over the impact of an anticipated rise in US interest rates.
A small majority of traders in a Reuters poll say a US interest rate hike could prompt the People’s Bank of China (PBOC) to raise short-term money market rates, as it did in March when the Fed raised rates, to stabilise money flows. A higher federal funds rate will narrow the interest rate gap between China and United States, which could pressure the yuan. But others said the authorities had moved to stabilise the yuan and the Fed decision was almost a foregone conclusion.
Chinese banks extended 1.11 trillion yuan ($163.4 billion) in net new yuan loans in May, above analysts’ expectations.
Predicted new yuan loans of 900 billion yuan, down from 1.1 trillion yuan in April.
Broad M2 money supply (M2) grew 9.6 percent in May from a year earlier, central bank data showed on Wednesday, missing forecasts for an expansion of 10.4 percent and compared with April’s 10.5 percent.
Outstanding yuan loans grew at 12.9 percent by month-end on an annual basis.
Expected outstanding loans to rise by 12.8 percent, after April’s 12.9 percent.
China’s banks extended a record 12.65 trillion yuan in loans in 2016 as the government encouraged credit-fueled stimulus to meet its economic growth target.
The credit explosion has stoked worries about financial risks from a rapid build-up in debt, which authorities have pledged to contain this year. ($1 = 6.7940 Chinese yuan) (Reporting by Beijing Monitoring Desk and Kevin Yao; Editing by Jacqueline Wong)
Overall, the bias in prices is: Sideways.
Short term: Prices are stalling.
Intermediate term: Prices are ranging.
By the way, prices are vulnerable to a correction towards 6.84.
The projected upper bound is: 6.81.
The projected lower bound is: 6.76.
The projected closing price is: 6.78.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 23 white candles and 24 black candles for a net of 1 black candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 48.5826. This is not an overbought or oversold reading. The last signal was a buy 7 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 19.81. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 118 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -72. This is not a topping or bottoming area. The last signal was a buy 4 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 22 period(s) ago.
Rex Takasugi – TD Profile
FOREX CNY= closed down -0.011 at 6.787. Volume was 43% below average (neutral) and Bollinger Bands were 183% wider than normal.
Open High Low Close Volume
6.796 6.798 6.786 6.787 1,228
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 6.80 6.87 6.85
Volatility: 1 2 3
Volume: 2,223 2,301 2,085
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX CNY= is currently 0.9% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume out of CNY= (mildly bearish). Our trend forecasting oscillators are currently bearish on CNY= and have had this outlook for the last 18 periods. Our momentum oscillator is currently indicating that CNY= is currently in an oversold condition. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.
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