Trading insights: Can EU, US and China share a “peace” of the same pie?

Chart 1

Chart 1 illustrates the relative exports percentage changes of year-on-year between China, Japan, Germany and the United States.

Market Talk:

De-risking supply chains away from China?

New dynamics in global trade underway: China reports weaker exports as Japan, Germany and US exports hold firm.

Latest exports data:

• China exports down -169.38%
• Japan exports up +10.95%
• Germany exports up +9.15%
• United States exports up +5.32%

Data tradingview 8/8/2023 7am UTC

Removing China from supply chains or diversifying risk?

It appears that China is exporting less to its major trading partners.

Is this a sign of slowing demand or is the geopolitical situation pushing the EU & US to diversify supply chains away from China in order to reduce supply chain risk?

China is too important to remove from EU & US supply chains

It's unlikely that US and EU businesses will want to cut trading ties with China. Economic ties between the US, EU and China have played an important role in the US and the EU’s economic success and vice versa.

International trade is maturing and this seems to be the ongoing trend of diversifying supply chains and China will most likely continue to be an important trade partner for the US and EU.

China, Japan, US and EU major stock indices all trading positive year to date

Bottom line: The pie is large enough for the EU, US and China to share a “peace” of the same pie.

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Today’s economic calendar

Source: TradingView / J. Knobel August 8 2023 6:27 AM UTC

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Trading prospective:

GBP / AUD resumption of the prevailing uptrend?

Technical commentary: GBP/AUD current price 1.9535 is trading near its 52 week highs (1.95608), upside momentum appears to be intact with the next challenge for price to overcome see near the 1.9625 resistance (see chart). Provided price can clear above the 1.9625s the prospects for a further price extension towards the 2.0570s can not be ruled out. Downside risk seen below the 1.9156 support (see chart).

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