USD/CNH bid on risk aversion, peeps above 100-day MA

• USD/CNH is solidly bid, now trading above the 100-day MA.
• The risk-off tone in the equity markets is likely pushing the dollar higher across the board.

The offshore Chinese yuan (CNH) is taking a beating amid risk aversion in the equity markets.

The USD/CNH pair is currently trading at 6.8867; up 0.40 percent on the day and above the 100-day moving average (MA) of 6.8831.

The solid gains are likely associated with risk aversion in the Asian equities and the resulting demand for the safe haven treasuries.

As of writing, the Shanghai Composite index is down 1.2 percent and Japan's Nikkei is reporting a 2.5 percent loss. Other Asian majors are also flashing red, possibly due to concerns over the inversion in the US treasury yield curve and uncertainty surrounding the details of the US-China trade truce.

Further, worries over Huawei CFO are likely weighing hurting Asian stocks, according to a Reuters report.

More importantly, the risk-off tone seems to have boosted demand for the US treasuries. That is evident from 10-year yield's slide to 2.878 percent - the lowest level since the first week of September.

As a result, the dollar is better bid against the Chinese yuan and other majors. The greenback, however, may come under pressure if the Us ISM non-manufacturing shows a slowdown in inflation and labor market.

USD/CNH Technical Levels