Fundamental Overview

• MYR managed to momentarily break below the critical 4.00 level on 4th January amid USD bearish bias and higher Brent crude oil price. However, MYR failed to maintain this momentum through the end of last week and traded lower due to profit-taking and safe-haven buying following the storming of the US Capitol by Trump’s supporters.
• MYR is likely to trade on a cautious note this week as investors cast a wary eye on the potential reimplementation of a more stringent measures amid worsening domestic COVID-19 situation. On the upside, MYR is seen to benefit from continuous USD weakness on the prospect of the Fed reaffirming its conviction to remain status quo.

Technical Analysis

• 5-day EMA indicator signals that the MYR may chart a slight appreciation against the greenback by 0.1% to 4.026 this week.
• The pair faces an initial support at (S1) 4.011, followed by (S2) 3.992. Conversely, a sustained rise above (R1) 4.043 suggests an extended bearish MYR trend.

Source: Kenanga Research - 11 Jan 2021