The Chinese government continues to pursue economic stimulus policies.

The yuan remains steady at around 7.13 yuan per dollar as investors respond to the latest monetary decisions from the People’s Bank of China. Recently, the central bank injected over 700 billion yuan into financial institutions through the Medium-term Lending Facility (MLF) while maintaining the interest rate at 2% to stimulate domestic economic growth amid ongoing economic challenges. Meanwhile, investors remain attentive to potential details of an 8 trillion yuan economic stimulus package, which could enhance company revenues.

Today, the Chinese government announced a 4 trillion yuan loan support expansion to assist struggling property developers, ease purchase restrictions, ensure timely housing deliveries, and lower mortgage rates to boost homebuyer confidence. Ni Hong, Minister of Housing, noted that real estate sales in top-tier cities have fully recovered, suggesting that China’s property sector may have hit bottom after a downturn of over three years. Concurrently, the National Financial Regulatory Authority recommended the use of various financial tools in the real estate sector to foster sustainable impact, extending these policies until the end of 2026.

China’s retail sales surged by 3.2% year-on-year in September, marking the strongest retail growth and highlighting the country’s consumer spending power. The growth was driven primarily by increases in sales of grains, oil, and food, which rose by more than 11.1%. Additionally, clothing, shoes, and hats showed positive trends as the winter season approaches.

China’s economy expanded by 4.6% in the third quarter of 2024 compared to the same period last year, exceeding the market’s forecast of 4.5%. This stable growth rate stems from continued weakness in the property sector, ongoing domestic demand uncertainties, deflation risks, and trade tensions with the West, as seen in minimal export growth over the past five months and ongoing sluggish imports. In response, the Chinese government has expanded its economic stimulus measures to further drive economic recovery and restore confidence in the domestic economy.

Techical analysis data (5H)

Resistance: 7.1227, 7.1247, 7.1256

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 7.1187 - 7.1197 but cannot break the support at 7.1197, you may set a TP at approximately 7.1247 and SL at around 7.1167 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 7.1227 - 7.1247, you may set a TP at approximately 7.1256 and SL at around 7.1187 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 7.1227 - 7.1247 but cannot break the resistance at 7.1227, you may set a TP at approximately 7.1187 and SL at around 7.1256 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 7.1187 - 7.1197, you may set a TP at approximately 7.1167 and SL at around 7.1247 or according to your acceptable risk.

Pivot point October 25, 2024 11:54 PM. GMT+7