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Offshore Yuan Reverses Earlier Losses And Garners Strength

CNH

Spot USD/CNH knee-jerked higher amid holiday-thinned liquidity but promptly reversed gains sinking into negative territory and last changes hands at CNH6.6327, down 160 pips on the day.

  • The uptick coincided with a Bloomberg headline noting that Beijing was shutting 40 metro stations across seven lines from today.
  • Bears have now taken control and if the rate falters past Apr 28 low of CNH6.5863, they would be able to target Jul 27, 2021 high of CNH6.5287.
  • Bulls need a break above yesterday's high of CNH6.6980 to see a resumption of the broader uptrend, which would bring Nov 4, 2020 high of CNH6.7745 into play.
  • Worth noting that U.S. Sec of State Blinken will outline his China policy in a speech on Thursday.
  • China's Caixin Services PMI will hit the wires also on Thursday.

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