▪ MYR reached its peak for the year on the final day of 2020, up by 1.7% on Dec 31st to 4.02 against the USD, its strongest since June 2018. One key driver of the ringgit’s strength has been the rise of Brent crude oil price mainly due to optimism as the race to vaccinate against COVID-19 virus has begun globally.
▪ MYR is seen to strengthen further in the first week of 2021 as the dollar is expected to extend its broad-based weakness on the back of positive global economic sentiment, strong crude oil prices and the global COVID-19 vaccination roll out.
▪ On the contrary, our 5-day EMA indicator suggests that MYR might reverse its steady appreciation and depreciate against the USD by 0.3% to 4.032 this week.
▪ Technical-wise, the USDMYR pair may move towards (R1) 4.039 and test (R2) 4.058, which indicates an upside pattern for the greenback. Nonetheless, a rally towards (S1) 4.011 will reaffirm the ringgit’s strength.
Source: Kenanga Research - 4 Jan 2021
Created by kiasutrader | Aug 26, 2024