• USD/CNY edged lower on Monday as attention shifted back to economic fundamentals following Chinese President Xi Jinping’s visit to Washington.
• The United States and China have agreed to cut tariffs on $30 billion worth of goods in each direction and launch a dialogue on artificial intelligence following Chinese President Xi Jinping’s three-day visit to the U.S.
•On the data front, China's industrial profit growth slowed further in August as strength in technology manufacturing amid the AI boom was outweighed by persistently weak domestic demand.
• Prior to market open, the central bank set the yuan's midpoint at 6.7399 per dollar, the strongest since February 3, 2023.
• China's yuan has gained 4.2% against the dollar so far this year to become one of the best-performing Asian currencies.
• Immediate resistance is located at 6.716(Daily high), any close above will push the pair towards 6.725(38.2%fib)
• Support is seen at 6.709(SMA 20) and break below could take the pair towards 6.694 (23.6%fib).
Recommendation: Good to sell around 6.715, with stop loss of 6.740 and target price of 6.680


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