USD/CNH and the 7.00 level acts as a good barometer for risk
The offshore yuan is strengthening a little today after a sharp move higher yesterday amid heightened concerns surrounding the coronavirus outbreak.
The fact we're seeing more calm today as the pair backs away from the 7.00 level indicates that the level of fear in markets is abating a little. That's part and parcel of why we're seeing the likes of the aussie and kiwi keep more steady as well.
Looking ahead, markets (more specifically, risk) will be facing battle between coronavirus fears and earnings season in Wall Street this week. On the latter, the first key one to watch will be Apple earnings after the closing bell today.
As for how all of that translates to USD/CNH, just be mindful if price starts to chase a move above the 7.00 handle. That may set off another round of risk aversion if we start to see more panic in markets during the course of the week.
