Week in FX Asia – China Manufacturing Expands

HSBC released their preliminary Manufacturing Index for China this week. The reading was very encouraging as output is above the 50 point threshold which signals an expansion. This indicator was the main reason while the world enjoyed a positive stock market rally and the EUR gained versus the USD during the United States Thanksgiving holiday break.

Japanese exports fell 6.5 percent in October, marking a fifth straight falling numbers. The territorial dispute with China drove exports to that nation by more than 10%. The European crisis has also reduced demand for Japanese good as exports to that region fell by 20%. The Yen was stronger in October than what we have seen in November. Japan needs a weaker Yen to recover a competitive advantage that will boost exports and Japanese companies earnings.

• USD/JPY Technicals – 3 Black Crows seen at 61.8% Fib Retracement
• USD/JPY Technicals – Open Position Ratios Analysis
• Japan Opposition Party Proposes 2 percent Inflation Target
• BOJ may announce “Unlimited Easing” to reach inflation target
• Japan Exports Fall 6.5 percent in October

• Yuan’s Convertibility “Next Step” for China’s Economic Reform
• HSBC Chinese PMI Highest in 13 Months – Asian Equities Trading Higher
• China Retired Leaders Block Two Reform Candidates
• China House Sales Rebound in October
• China Xi Jinping to Tackle Corruption
• China Manufacturing Expands
• Highest HSBC China PMI in 13 months – Reactions and Charts

• AUD/USD Technicals – 1.032 vs 1.042
• EUR/AUD Techincals – 1.23 Structural Support Risk to Downside

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