CNH: USD/CNH Firms Above 6.7000 Post CNY Fixing, Can We Test 20-day EMA?

USD/CNH has continued to edge higher post the earlier tick up in the USD/CNY fixing. We are above Tuesday highs, last 6.7050. This is line with broader USD moves, with the BBDXY index now up close to 0.15% for the session. The rise in the USD/CNY fixing ended a run of downside moves in the fix since earlier in Sep, hence leaving less support to the yuan outperformance theme. For USD/CNH, 20-day EMA resistance isn't too far away, resting close to 6.7110. This resistance area has capped moves higher in the pair back to mid July, see the chart below. * Focus will remain on the Xi/Trump leadership summit, with earlier headlines stating Trump will host an arrival ceremony for the China President at 6pm ET (US time) on Wednesday. Trade, AI and agricultural purchases are all expected to feature (albeit with expectations the broader status quo will be maintained around these key issues rather than any dramatic improvement or deterioration). * USD/CNH risk reversals have ticked higher, more so at the front end, with the 1 month back above 0.06, which is around mid Aug levels. Implied vols are very depressed through, 1 month back to 1.73%. Fig 1: USD/CNH Spot Versus Key EMAs Finance L.P./MNI