FxWirePro: USD/CNY rallies to 16-month peak, good to buy on dips

• USD/CNY surged to a 16-month peak on Monday, driven by investor worries over Donald Trump's possible return to the White House and doubts about China's economic recovery prospects.

• Despite China's attempts to halt the Yuan’s decline through daily benchmarks, falling domestic yields and ongoing economic struggles have undercut  these efforts.

• Two weeks before Trump's second term begins, fears of significant tariffs on Chinese imports have unsettled the Yuan, pushed down mainland bond yields, and caused a challenging start for stocks in 2025.

• The yuan fell 2.8% against the dollar in 2024, marking its third consecutive annual decline, reflecting the widespread challenge many currencies face against a robust dollar.

• At GMT 09:24,the dollar was up 0.12% at 7.328 against Chinese Yuan .

 •  Immediate resistance is located at 7.330(23.6%fib), any close above will push the pair towards 7.336(Higher BB)

• Support is seen at 7.318(Daily low) and break below could take the pair towards 7.311(38.2%fib).

Recommendation: Good to buy around  7.320 with stop loss of 7.250 and target price of 7.360