FxWirePro: USD/CNY hits fresh 14-month low, scope for further downside

• USD/ CNY hit fresh 14-month low  on Thursday as the greenback weakened following a Fed rate cut while investors look to China's key policy meeting for further guidance..

• Overnight, the U.S. Federal Reserve cut its benchmark rate by 25 basis points to 3.5–3.75% as expected, while offering a less-hawkish outlook than anticipated, helping calm market nerves.

•The yuan has gained 3.4% against the dollar so far this year, putting it on track for its strongest annual performance since 2020.

• The next key event to watch is the Central Economic Work Conference, where remarks on the economy and exchange rates could have a major impact on the yuan’s future direction..

• Since late April, the central bank has been steadily lifting its daily yuan fixing, signaling a willingness to allow some appreciation..

•  Markets are also awaiting signals on next year’s growth targets from China’s annual Central Economic Work Conference, typically held in December, while traders are watching credit-lending data due later this week for clues on economic momentum.

•  Immediate resistance is located at 7.083 (Dec 9th high), any close above will push the pair towards 7.082(SMA 20).

• Support is seen at 7.055(23.6%fib) and break below could take the pair towards 7.047 (Lower BB).

Recommendation: Good to sell around 7.065  with stop loss of 7.090 and target price of 7.050