USDCNY saw big gains into the end of the week after Trump’s pole position in the election was surrendered with Joe Biden apparently closing in on the win despite the ongoing count.
The state of Georgia has announced a recount while legal wrangling continues in other swing states. The country is still waiting for confirmation from some Democratic swing states and we will enter the weekend still without any clear winner. Donald Trump’s campaign are also looking to involve the Supreme Court so the result should drag into next week.
The Yuan has rallied after traders expected the trade talks between the two countries to be more favorable to China in the event of a Biden win. Trump has built his Presidency on a hardball negotiating stance against other foreign nations and it looks like China has stalled talks until the election winner was declared.
The USDCNY will hold this bearish tone into the weekend but there could be volatility if the matter goes to the Supreme Court. The pair may continue to see pressure as markets price in a lengthy battle and avoid bullish dollar positions in the near-term.
USDCNY Technical Outlook
The USDCNY attempted a Wednesday rally above resistance but has since crashed through support. The pair now trades at 6.610 and the trend is still bearish. Another chance to short may come ahead of 6.650 with a stop above that level. The better trade may be long but there is risk involved. The Investing Cube team is currently available to help all levels of traders with the Forex Trading Course or one-to-one coaching.
USDCNY Daily Chart