- The USD/MYR continues to correlate to the broad market and has seen selling create a trend lower since the 19th of February.
- The current price of the USD/MYR is near 4.7280 and this ratio saw plenty of price action in the last week of January.
- However, the last time the 4.7280 area was being tested was when the USD/MYR was within a bullish run higher and the 4.7300 level was clearly acting as resistance which eventually proved vulnerable as the currency pair rushed higher in the first week of February.
Financial institutions have had their behavioral sentiment regarding the USD shift again, and the outlook for the time being appears to believe a weaker trend is developing. Fed Chairman Powell will be speaking later today and tomorrow in Washington D.C and this will affect USD outlook. The broad Forex market has seen some weakness in the USD develop recently and the USD/MYR has benefitted from this development as the currency pair has trended lower.
4.7300 Key Barometer in the USD/MYR
Yesterday’s trading in the USD/MYR and the ability to break below the 4.7300 caused some price velocity to be demonstrated. The currency pair hit a low of around 4.7200 before reversing higher. Early trading this morning saw the 4.7200 level again briefly, but the lower ratio could not be sustained. However, what may intrigue speculators of the USD/MYR is the notion that the 4.7300 mark has developed as short-term resistance.
While a high of around 4.7340 was challenged briefly this morning, selling pressure continued to be displayed as the USD/MYR remained in correlation to the broad Forex market. Short term sentiment will remain cautious and traders should not be overly ambitious regarding price movement because of the testimony Federal Reserve Chairman Powell will give regarding Fed monetary policy in front of the U.S Senate today.
Near-Term Considerations for the USD/MRY
Financial markets will respond to Powell’s comments and he is expected to remain cautious regarding the central banks outlook. While the USD has been believed to have been overbought and it now appears financial institutions are leaning towards a weaker USD outlook, Powell’s rhetoric today and tomorrow will certainly influence short-term trading.
Traders who are looking for more downside in the USD/MYR cannot be blamed; resistance near the 4.7300 level should be viewed as important.
If the USD/MYR can sustain trading below the 4.7300 ratio it may signal selling sentiment remains active for near-term endeavors.
Traders need to use solid risk management to guard against sudden fluctuations in the USD/MYR which could develop because of Jerome Powell.
USD/MYR Short Term Outlook:
Current Resistance: 4.7320
Current Support: 4.7245
High Target: 4.7420
Low Target: 4.7210
Ready to trade our daily Forex forecast? Here’s a list of some of the top forex brokers in Malaysia to check out.