USDCNH drifted higher and finally and softer global PMIs, but then quickly retraced on Friday on the news that Trump is interested in making a deal with China at the G20 summit this month (November 29-December 1).
The focus for this week for CNY is the Trump-Xi meeting at the G20 Summit on 30 November-1 December. While both sides expressed somewhat positive signals to de- escalate the trade tensions, there are still a lot of uncertainties ahead of us.
On FX market, the CNY exchange rates remain directionless as USDCNY has been hovering around 6.95 in recent weeks.
OTC updates:The implied volatility of USDCNY options has been on the rise since October, indicating that the market remains vigilant for the time being.
Unfortunately, there are a lot of risks that can’t be fully hedged by the FX derivative market. Look at what happened in GBP in recent weeks, and you will understand my point.
Trade tips:Buy 9M 40D (7.12 strike) USD calls/CNH puts vs. sell 9M 4.60-5.20 AUDCNH Strangle.
Currency Strength Index:FxWirePro's hourly CNY spot index is flashing at -5 levels (which is neutral), hourly USD spot index was at 11 (mildly bullish) while articulating at (12:57 GMT). For more details on the index, please refer below weblink:


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