Chart of the day: No rest for yuan
While mainland China has been enjoying the golden week holiday, do not think market-making activity stopped. In Hong Kong, the offshore yuan has continued its tendency to weaken against the US dollar. Technically, what is more important is that it managed a weekly close on October 7 just above the top of the very large triangle that has dominated all year. It is not completely out of the woods though, with the lagging line facing a possible impediment at 6.7325 and then, of course, January’s high at 6.75. Probably before the end of this month, we expect a test of this important chart level. Above here and we will reach levels the onshore yuan has not seen since September 2010.
Nicole Elliott is a technical analyst