Ella 
24-hour view: We highlighted yesterday that “weaker underlying tone suggests USD/CNH could test 7.1240”. Although the exchange rate fell below 7.1240 (low 7.1170), it rebounded sharply to 7.1774. Today, the price may rebound further, but is unlikely to threaten 7.2000 (minor resistance at 7.1870). On the downside, a break below 7.1500 (minor support at 7.1585) would imply no further recovery.
Next 1-3 weeks: Two days ago (July 26, spot price 7.1465), we emphasized that “the downward momentum has strengthened, and the exchange rate has room to weaken further”, and added, “It is worth noting that there are several strong Support is at 7.1240 and 7.1000. Downside momentum appears to be fading. From here, a break above 7.2000 (“strong resistance” level unchanged) would suggest that 7.1000 is out of the question this time around.
