• USD/CNY hit four month high on Tuesday as US tariff threat weighed Chinese yuan.
• U.S. President-elect Donald Trump said he would impose a 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China.
• The proposed tariffs, as well as other policies such as tax cuts, are seen as inflationary and likely to keep U.S. interest rates relatively high, hurting currencies of U.S. trading partners.
• At GMT 10:57,the dollar was up 0.16% at 7.250 against Chinese Yuan .
• Immediate resistance is located at 7.259(23.6%fib), any close above will push the pair towards 7.266(July 30th high)
• Support is seen at 7.239(SMA9) and break below could take the pair towards 7.224(38.2%fib).
Recommendation: Good to buy around 7.248with stop loss of 7.200 and target price of 7.280
