USDCNH trades just below the 6.90........>

CHINA YUAN: USDCNH trades just below the 6.90 level following the failure of

bulls to cement gains above here on Friday and at today's open. Below this level

keeps the yuan's recovery intact, while bulls look to break above here to target

the 50-dma at 6.9245, above which the broader bull market would resume. 

- The yuan is holding up in spite of the weakness seen in China's trade data

over the weekend, which saw imports grow by just 2.7 y/y in dollar terms, as

well as the news that China's vice foreign minister summoned the U.S. Ambassador

to China to protest the arrest of Huawei Technologies Co.'s chief financial

officer.

- Much of the yuan's strength can be put down to dollar weakness against the

majors, although the yuan is outperforming among EM FX.