USD/MYR Forecast Today - 23/09: USD Seeks MYR Floor (Chart)
Date
9/23/2024 5:04:26 AM
(MENAFN- Daily Forex)
It's obvious to me that the market is going to continue to be very weak, and although we have ended up forming a bit of a hammer, the reality is that this is a pair that is seen massive selling pressure. All things being equal, the GDP in Malaysia is extraordinarily strong, coming in at 5.9% earlier this year. At the same time, we are starting to see the US Economy slow down a bit as employment is starting to soften.
At this point, we have to ask the question“Who is left to sell the USD/MYR currency pair ?” All things being equal, this is a market that I think continues to see a lot of volatility, but we are so oversold that it's difficult to start shorting again. At this point in time, I think that a lot of traders will be looking for some sign of a bounce that they can take advantage of. After all, the interest rate differential still favors the United States, despite the fact that the Federal Reserve had cut 50 basis points during the week.
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There is absolutely nothing on this chart that looks even remotely bullish for the US dollar. However, it's worth noting that the 4.2 region is an area that we have seen a lot of support in the past, and therefore it would not be surprising at all to see the market into some type of bottoming pattern. If it does, then we need to see some type of impulsive move in order to start following the greenback to the upside.
The way that the market rally and from here happens in my estimation is that we get some type of major“risk off move” around the world as traders start to worry about the global economy. While we are not at that point yet, the fact that the Federal Reserve had to cut rates by 50 basis points to get in front of potential problems, suggests to me that might be coming down the road. Because of this, I think you are in the process of trying to find the floor and therefore it should be rather choppy.
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