▪ MYR depreciated against the USD on Fed’s dismissal of negative interest rates, Trump’s threat to cut off ties with China and continued plunge in China retail sales data. The fall was cushioned by further improvement in Brent crude oil price and a better-thanexpected 1Q20 GDP.
▪ MYR is expected to face further weakness this week, as the outlook remains clouded by domestic political tussle and theUSChina trade tension, outweighing support from higher oil prices as global fuel demand improves.
▪ Looking at the EMA technical indicator, MYR is expected to rebound, albeit slightly, by 0.29% to 4.338 this week, highlighting a potential bullish comeback for the local note.
▪ From our technical viewpoint, the outlook for USD trend this week remains to the downside. Its support level points to S1 at 4.336 and a break below this critical support can signal further downtrend towards the (S2) 4.320 level. However, any significant pro dollar catalysts may induce the greenback to settle above the (R1) 4.359 level.
Source: Kenanga Research - 18 May 2020
Created by kiasutrader | Aug 26, 2024