China's economy still experiences uncertain growth.

The Chinese yuan depreciated slightly after a period of stability, reflecting ongoing uncertainties regarding domestic recovery and a lack of significant economic stimulus to support renewed growth. Meanwhile, the U.S. dollar was buoyed by remarks suggesting continued uncertainty over rate cuts by Federal Reserve officials, with investors closely watching today's FOMC meeting for more clarity.

In its May meeting, the People's Bank of China kept interest rates unchanged, in line with market expectations, maintaining the one-year Loan Prime Rate (LPR) at 3.45% and the five-year LPR at 3.95%. However, the government continues to attempt to stimulate economic recovery following less-than-expected economic data. Efforts remain focused on sustainable industrial production growth, along with measures such as reducing down payments for first-time homebuyers and lowering mortgage rates to bolster the long-ailing real estate sector.

China's retail sales increased by 2.3% year-on-year in April, missing market forecasts of 3.8% and down from a 3.1% growth in the previous month. This indicates a slowing growth momentum post-holiday season and highlights the challenges the government faces in introducing additional economic stimulus measures. Notably, cooking oil sales continued to grow the most, in contrast to declining sales in clothing and accessories.

China's industrial production expanded by 6.7% year-on-year in April, exceeding market expectations of 5.5%. The industrial sector continued to receive government support, boosting manufacturing activities, particularly in utilities, machinery, and other electrical equipment. Meanwhile, the output of the oil and natural gas industry increased only slightly, indicating slowing foreign demand.

The 10-year government bond yield remained stable at around 2.3%, as the People's Bank of China decided to keep interest rates unchanged. Additionally, China has policies in place to support the real estate market and various domestic industries, including the issuance of special long-term bonds. These bonds, issued on May 17, include 20-year, 30-year, and 50-year maturities totaling over $138 billion.

Techical analysis data (5H)

Resistance: 7.2404, 7.2412, 7.2423

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 7.2374 - 7.2385 but cannot break the support at 7.2385, you may set a TP at approximately 7.2412 and SL at around 7.2365 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 7.2404 - 7.2412, you may set a TP at approximately 7.2423 and SL at around 7.2374 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 7.2404 - 7.2412 but cannot break the resistance at 7.2404, you may set a TP at approximately 7.2374 and SL at around 7.2423 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 7.2374 - 7.2385, you may set a TP at approximately 7.2365 and SL at around 7.2412 or according to your acceptable risk.

Pivot point April 22, 2024 06:54 PM. GMT+7