USD/MYR Today Forecast 01/03: Downward Trend (Chart)
Date
3/2/2024 12:00:42 AM
(MENAFN- Daily Forex)
The US dollar has fallen rather hard during the trading session on Thursday as we continue to see a lot of negativity out there when it comes to central bank policy. At this point in time, the PCE numbers coming out as expected suggest that the federal Reserve is going to be on hold and therefore will only cut 3 times this year. That has weakened the US dollar, but it's also worth noting that there is a bit of technical analysis to pay attention to against the Malaysian Ringgit.
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It looks as if the 4.80 level has formed a bit of a double top, and it will be worth focusing on whether or not that's an area that we can break above. As we have pulled back from there it looks like we are also sitting just above the 50-Day EMA , a technical indicator that a lot of people would pay attention to. With this, I think there is the possibility that we get a bit of a bounce, but I also recognize that the 4.80 level is going to be very difficult to overcome.
That being said, if we were to break above there, it could open up the possibility of this pair rising to the 5.00 level, which obviously has a lot of psychology attached to it. Because of this, I think you have to think about this through the prism of whether or not you can find value on dips that are were taken advantage of, or if we are going to break down significantly from here? Keep in mind this is a fairly thin currency pair and very few people are trading it so it can move rather quickly.
Use this as an idea as to how the US dollar is going against emerging market currencies, especially in Asia. That being said, the 4.60 level is probably the bottom of this pair at the moment so I wouldn't think that we break down below there anytime soon, but if we did it would obviously be extraordinarily negative for the US dollar in general.
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