▪ MYR moved in a very tight range between 4.237 to 4.239 against a strengthening USD despite the domestic political turbulence and record high daily COVID-19 cases. To note, the USD index (DXY) soared above the 93.5 level on Aug 19, a 9-month high, following hawkish Fed minutes. The local note closed slightly weaker against the greenback last week as Brent crude oil price fell 7.7% on a weekly basis to settle at a 3-month low of USD65.2/barrel.
▪ The focus for this week would be the Fed remarks at the Jackson Hole event, any sign of tapering could push the DXY towards the 94.0 level, further weakening the local note. Additionally, if the Brent crude oil price further retreat towards the USD60.0/barrel threshold, the USDMYR pair may trade above the 4.25 level. While the number of domestic COVID-19 cases may continue to rise in the near term, rapid vaccine rollout and the partial easing of movement restrictions should continue to buoy the ringgit.
▪ Despite USD buying pressure, 5-day EMA indicator signals a reversal in the USDMYR trend, with the ringgit expected to appreciate marginally against the greenback by 0.04% this week.
▪ The pair faces an initial support at (S1) 4.238, followed by (S2) 4.236. Inversely, a sustained rise above the (R1) 4.240 level may suggest an extension of the bullish USD trend.
Source: Kenanga Research - 23 Aug 2021
Created by kiasutrader | Aug 26, 2024
Created by kiasutrader | Aug 26, 2024