USD/CNH consolidates above CNH6.9000.....>

CHINA YUAN: USD/CNH consolidates above CNH6.9000 (last trades +122 pips at

CNH6.9016) after rallying through the level amid reports highlighting tensions

between the U.S. and China over Huawei/technology rivalry. Sources told RTRS

that the Trump administration is planning to enact a rule that would strengthen

its power to block shipment to the Chinese tech giant. Separately, the WSJ

reported that the U.S. and China are set to continue their tech rivalry despite

the phase-one accord, with Washington preparing tighter restrictions on Huawei.

- The rate has thus extended gains registered during yesterday's rebound from a

multi-month low. Although positive developments in U.S.-China relations inspired

a drop below CNH6.8700 in early trade Tuesday, the rate bounced off a key

support zone (highlighted in a bullet from 06:11 GMT 01/14) firmly into positive

territory. Worth noting that RSI sent a buy signal, crossing above 30.

- Bulls look for a more sustained rally, keeping an eye on the 23.6% retracement

of the Sep 3 - Jan 14 slide at CNH6.9442. A break here would open up the Jan 2

low of CNH6.9567. Bears need a clean break under the support zone in the

CNH6.8700 area to see a clear resumption of the downtrend.