The yen's sharp reversal has taken centre stage on the foreign exchange front in recent weeks. However, with the yuan-won remaining in lock-step with the US dollar-yen, there has been an equally sharp reversal in the case of won against the yuan (more than 8 per cent since the start of September). While momentum trends point to further won weakness, the degree of optimism built into yuan-won suggests increased potential for contrarian resistance to emerge as highs for the year are tested. Yuan-won has settled into longer-term range of 162-186 since 2010. In the near term, however, resistance may begin to emerge at 178.8, as extended optimism runs into an important Fibonacci level (marking a 62 per cent retracement of the yuan-won's 2013-14 decline).