Before the bell: the yuan fell near the levels of the era of the crisis. What China is going to do is going to shape the trade war

At the same time, the Chinese government may be reluctant to support its currency, as this could open the door to a new criticism of Washington.

"China is caught between the hammer and the anvil," said Miguel Chanco, chief economist for Asia at Pantheon Macroeconomics.

China might be tempted to use its currency as a weapon Athanasios Vamvakidis and Claudio Piron, analysts at Bank of America Merrill Lynch, said Friday in a note to customers.

Letting the yuan depreciate would be a "softer" option than targeting US companies or investing in China, they said. The veteran hedge fund, Mark Yusko, thinks China could do it without causing too much trouble to its own economy.

As a general rule, when the yuan weakens, China should worry about an exodus of cash from the country as investors lose trust and exchange. yuan for holdings in dollars and other currencies. Yusko says this is not a problem for Beijing, which could impose capital controls.

This does not mean that such a strategy is risk free.

The yuan falling below US $ 7 against the US dollar could trigger further sales, causing it to fall further, Chanco said. That would probably be unattractive for Beijing, he added.

Another big question is whether China chooses to sell the US Treasury at a faster pace, buying the yuan and boosting its value.

China reduced its holdings of US debt in March to $ 1.12 trillion in US Treasury securities, the lowest level in almost two years.

Chanco considers the dumping of the US public debt as the nuclear option, while Yusko thinks that China will absolutely accelerate sales of treasury securities if a resolution is not reached soon.

"I think it's very likely," he said.

2. Annual meetings: The annual meeting of shareholders of Amazon takes place on Wednesday and this year's proxy statement is a real doozy, with 12 shareholder proposals covering everything from face recognition technology to food waste.

A resolution backed by thousands of employees of the company would require a report on the company's actions to deal with climate change and prepare to do so.

Expect analysts to pressure retailers to find out how they intend to manage tariffs and their exposure to China.

4. Meeting in the desert: Attacks of armed drones. A growing trade war. Devastating sanctions against Iran and Venezuela. OPEC and its allies are not lacking hot spots to discuss at Sunday's meeting in Jeddah, Saudi Arabia.

The summit, organized by the group's compliance committee, could provide clues as to whether producers will accept Trump's pressure to increase production at next month's meeting in Vienna.

5. Coming next week: