With all eyes squarely focused on US equity markets daily impersonation of the Caracas Stock Index, BofAML is growing increasingly concerned about China. Since the start of December, Chinese equities have been under significant pressure with the Shanghai Composite on the edge of completing a 3-month Double Top. A break of 2079 would confirm this move, exposing considerable downside in the weeks ahead.

This could also prove to be the catalyst that ends the 17-month downtrend for USDCNY.

Since late October the pair has shown tentative signs of basing. A sustained break of 17m trendline resistance (6.0747) would confirm a medium term turn in trend, exposing the Aug/Sep highs at 6.1225 and potentially beyond.

BofAML concludes with one word... "Beware."