▪ MYR continued its bullish momentum last week, edged up against a weaker USD on the back of COVID-19 vaccine optimism and relatively stable Brent crude price, while further amplified by the dovish US Fed amid escalating US-CN tensions.
▪ The local note is expected to trend lower this week on continuation of broader USD bounce after Fed meeting last week. It is also partly due to euro and sterling profit taking following an extended rally. Nonetheless, the USD rebound is expected to be short-lived as the US recovery momentum loses steam, coupled with surging COVID-19 cases and weak US economic data
▪ The USD trend is reflected in our EMA technical analysis asMYR is expected to depreciate marginally by 0.13% to 4.245 this week, reinforcing the expected USD comeback this week.
▪ The short-term technical outlook sets the stage for an upturn in USD with immediate resistance area at (R1) 4.249, a break of which will test the (R2) 4.258 threshold. Conversely, a downward reversal may drive the pair towards the (S2) 4.230 level, should the pair tilt below the (S1) 4.235 support level.
Source: Kenanga Research - 3 Aug 2020
Created by kiasutrader | Aug 26, 2024