USD/CNH hits fresh 21-month high of 6.9675

• Offshore yuan (CNH) has dropped to the lowest level since December 2016 against the Us dollar.
• The currency pair is looking overbought as per the relative strength index (RSI) on the daily and the weekly chart.

Currently, the USD/CNH pair is trading at 6.9670, having clocked a 21-month high of 6.9675.

The Chinese currency came under pressure after the People's Bank of China (PBOC) announced the midpoint rate at 6.9510 - the highest since January 2017.

The currency pair now looks set to test the major psychological level of 7.00. A break above that level may lead to another broad-based rally in the USD and risk aversion in the global equities.