As mentioned in late February, we believe the onshore yuan is in the process of forming a double bottom against 6.26 per US dollar, in what now looks like a rectangle chart pattern. This has taken longer than expected and is in stark contrast to the ferocious tumble the exchange rate has seen since the middle of December. Though the cloud continues to cap the candles, moving averages are now mixed. Daily and weekly closes above 6.36 yuan will complete an interim base, allowing the dollar to rally to the 6.4725-yuan area.