FxWirePro: USD/CNY slides to fresh 3-1/2-year low as yuan firms

• USD/CNY hit fresh 3-1/2-year  on  Monday   China's yuan firmed as the central bank softened its curb on currency appreciation ahead of the meeting this week between the leaders of China and the US.

•The central bank has kept its daily yuan guidance weaker than market forecasts for almost a year, which traders and analysts interpret as an attempt to contain the currency’s gains..

•The PBOC has been setting a stronger yuan midpoint this month, bringing the official fixing closer to market expectations after the gap widened to its largest since February, indicating reduced resistance to further yuan gains.

•Talks between US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng ended in New York on Sunday, providing a framework for Presidents Donald Trump and Xi Jinping to review when they meet on Thursday.

• AI, trade ties, supply chains and developments in the Middle East are expected to feature prominently in the talks, though analysts see little prospect of a significant policy breakthrough.

•  Immediate resistance is located at 6.707(Sep 18th high), any close above will push the pair towards 6.712(SMA 20)

• Support is seen at 6.6946(23.6%fib) and break below could take the pair towards 6.688 (Lower BB).

Recommendation: Good to sell around 6.700, with stop loss of 6.710 and target price of 6.680