• USD/CNY strengthened on Thursday as Yuan weakened on expectation China may weaken the yuan to weather the risk of U.S. trade tariffs.
• Chinese long-term rates fell to historic lows on expectations of monetary easing, putting additional pressure on the yuan and increasing the yield gap with the US to the widest level in 22 years.
• The Chinese currency has fallen for ten weeks in a row, dragged down by tariff threats from US President-elect Donald Trump and monetary policy divergence between China and the US.
• At GMT 12.08,the dollar was up 0.09% at 7.266 against Chinese Yuan .
• Immediate resistance is located at 7.272(23.6%fib), any close above will push the pair towards 7.282(Higher BB)
• Support is seen at 7.246(Dec 11th low) and break below could take the pair towards 7.234(38.2%fib).
Recommendation: Good to buy around 7.260 with stop loss of 7.200 and target price of 7.300
