In a nutshell, I am expecting Copper to keep Chinese Equities afloat and recover Q120 with less uncertainty via fiscal policy and a rebound in exports. For those following the latest Hang Seng / Copper chart:
For the macro side, CNY will find a strong bid via trade tensions easing as we move into 2020 US elections. China's outlook for future generations is changing and while Trump protectionism causes USD devaluation via FED permanent operations. Flow wise I am expecting a lot of business to be done within 1H20 in FX markets, my main targets for 2020 remain at 6.85xx with momentum picking up in the decline through 2021.
The reflationary theme is picking up traction and if we see the Dollar materially decline it will be enough to provide some further growth to Chinese exports in Q1, however from Q2 onwards it will be countered via capex softening and provide a choppy consolidation range. I look for this to break in the second half of 2021 which will complete the macro driven pullback towards my main swing target at 6.50.
From a technical lens it should be no surprise we are trading the same key 6.949x from before in USDCNH:
While for those tracking the long term dollar devaluation we have covered the macro side in previous charts:
Good luck all those planning FX trades into 2020. The environment is going to become increasingly difficult as investors position around US election risks, more 2020 FX outlook reports along with other strategy research in the coming days and weeks. Thanks for keeping the support coming with likes and comments!
For the macro side, CNY will find a strong bid via trade tensions easing as we move into 2020 US elections. China's outlook for future generations is changing and while Trump protectionism causes USD devaluation via FED permanent operations. Flow wise I am expecting a lot of business to be done within 1H20 in FX markets, my main targets for 2020 remain at 6.85xx with momentum picking up in the decline through 2021.
The reflationary theme is picking up traction and if we see the Dollar materially decline it will be enough to provide some further growth to Chinese exports in Q1, however from Q2 onwards it will be countered via capex softening and provide a choppy consolidation range. I look for this to break in the second half of 2021 which will complete the macro driven pullback towards my main swing target at 6.50.
From a technical lens it should be no surprise we are trading the same key 6.949x from before in USDCNH:
While for those tracking the long term dollar devaluation we have covered the macro side in previous charts:
Good luck all those planning FX trades into 2020. The environment is going to become increasingly difficult as investors position around US election risks, more 2020 FX outlook reports along with other strategy research in the coming days and weeks. Thanks for keeping the support coming with likes and comments!
