The USD/MYR has tracked lower in recent sessions and as of this writing is near the 4.0820 ratio, this after the currency pair fought off highs from last week and has incrementally started to test support levels.
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The 4.0820 mark in the USD/MYR is now being seen. While Monday’s low of nearly 4.0510 was significant and some traders will certainly point out the slight upswing in the USD/MYR since then, the currency pair does remain within its near-term lows. The long-time bearish trend of the USD/MYR did run into headwinds at the start of June, but the high seen on the 22nd of June near 4.1520 has eroded.
Day traders considering pursuit of the USD/MYR at the current levels have a few things to consider via risks. Depending on the timeframe chosen for the USD/MYR speculatively, the USD/MYR carries a few different technical perceptions. USD centric strength has dominated the broad Forex market since the 17th and 18th of June, but the USD/MYR continues to standout as a currency pair that is correlated to global trading mechanics, but one too – that offers some dynamic divergence.
Emerging Market and the USD/MYR
The USD/MYR at its current level having crawled slightly higher the past couple of sessions has however maintained a lower stance. The ability of the USD/MYR to fight off rapid fire buying and stay within sight of known lows is intriguing. Day traders may be tempted to look for some quick hitting moves lower over the short and near-term. The emerging market status of the USD/MYR means the currency pair is not widely traded, meaning it is out of the sights of many large speculators. This means financial institutions are the biggest influence (besides the Malaysian government) on day to day gyrations.
Speculators of the USD/MYR should also consider the U.S is about to start a long holiday weekend because of the July 4th celebrations. Intriguingly, trading volumes will likely become lighter today from the U.S and certainly will be lower on Friday. While Monday will be the banking holiday in the U.S, the fact is with lower volume, the USD/MYR could be prone to some volatility caused by Malaysian financial institutions and other nearby spheres.
USD/MYR Going into the Weekend
The influence of sentiment from the U.S is always a factor in Forex and the USD/MYR is certainly part of this scenario.
Risk appetite in U.S stock markets is anxious for the moment, this has created some choppy conditions.
As traders volumes drop over the next few sessions because of the U.S extended holiday weekend, USD/MYR may find an opportunity to guage what local factors (from Malaysia) believe holds true.
In other words if the currency pair remains near its lower realm and shows a tendency to move downwards, this will show the USD/MYR is thought to still be in slightly overbought terrain.
USD/MYR Short Term Outlook:
Current Resistance: 4.0840
Current Support: 4.0790
High Target: 4.0930
Low Target: 4.0510
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