• USD/CNY fell to one-month low on Thursday as the yuan gained strength following the Fed’s decision to hold rates steady and the PBOC’s stronger yuan fixing.
• The Federal Reserve left interest rates unchanged, while Chair Kevin Warsh offered little clarity on how divisions within the rate-setting committee would be resolved.
•Fed funds futures now show a 42.6% chance of the Fed keeping rates unchanged at its September meeting, up from 24% before the latest policy decision, according to CME Group’s FedWatch tool.
• Prior to the market opening, the People's Bank of China set the midpoint rate at 6.7892 per dollar, its strongest since February 10, 2023.
• The yuan is up 0.4% against the dollar this month, and 3.5% firmer this year.
• Immediate resistance is located at 6.778(38.2%fib), any close above will push the pair towards 6.785(July 13th high)
• Support is seen at 6.755(23.6%fib) and break below could take the pair towards 6.748 (Lower BB).
Recommendation: Good to sell around 6.760, with stop loss of 6.830 and target price of 6.720
