Ella 
24-hour view: Yesterday, we thought USD/CNH could test 7.1240 before stabilizing. USD/CNH did not test 7.1240 but traded sideways in the 7.1370/7.1636 range. Fundamentals still appear to be weak and we continue to think USD/CNH could test 7.1240. Initial resistance is at 7.1550, then at 7.1600.
Outlook for next 1-3 weeks: After USD/CNH crashed to a low of 7.1259, we highlighted yesterday (July 26, when price was at 7.1465) that “downward momentum has picked up and USD/CNH has the potential to weaken further space”. We added, “It is worth noting that there are several strong support levels at 7.1240 and 7.1000. We continue to hold the same view. As long as USD/CNH remains below the strong resistance level of 7.2000, the downside risk is will not change.
