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USDCNH has stuck within a tight range....>

CHINA YUAN
CHINA YUAN: USDCNH has stuck within a tight range since falling to new cycle
lows in Asian trading yesterday. The pair sits at 6.7911 with bears looking to
extend the downtrend below yesterday's low of 6.7800. The 1-month risk reversal
has plunged into negative territory, hitting its lowest level since 2011
yesterday 
- The yuan continues to outperform non-dollar FX, with CNHKRW remaining clear of
the 164 level following yesterday's break.
- EURCNH dropped back down to range lows yesterday but the 200-dma held firm yet
again. A close below this level, which comes in at 7.8073, would suggest a major
topping pattern in the pair. 
- Rate markets are not confirming the bullish move seen in the yuan which
suggests caution is warranted. A clean break above 2.6% in 2-year swaps would
help the yuan's fundamental backdrop. 

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