As Chinese holidaymakers trickle back to town and to work, it is a good time to look back at January’s price action. The yuan has been at centre stage and, on record volume, the offshore unit has retreated from its weakest ever against the US dollar at 6.987, forming a monthly bearish engulfing column in the process. This follows weekly ones in December as well as the one last month that we warned about. It is a good example of how technical analysis and market moves work in fractals, similar patterns forming in each higher time frame. As previously stated, we have found an interim high and, over the next few months, sideways consolidation is highly likely, probably above 6.70.