After hitting the 4.1350 support level a few days ago the USD/MYR has developed a slight reversal and is trading near the 4.1470 juncture early this morning. The Malaysian Ringgit remains near important support levels versus the USD and this is likely not going to suddenly change. However, short term risk adverse trading has caused some bullish momentum to be demonstrated the past day, and speculators need to carefully consider today’s perceptions against their long term views.
One way to trade the USD/MYR in the short term will be to use conservative amounts of leverage if a speculator prefers to sell the USD/MYR and pursue their long term outlooks. Global equities are mixed this morning and while the selloff in US markets yesterday was not violent it has produced cautious sentiment momentarily.
Traders will want to consider resistance levels near the 4.1490 level as potential stop loss targets. Yesterday’s reversal higher and then this morning’s initial move upwards afterward a retest of support may make traders nervous because of its whipsaw results. One way to rectify this could be to actually buy the USD/MYR with a short term target of 4.1490 and to keep in mind the potential the forex pair might then challenge the 4.1530 juncture which it reached yesterday at the height of a temporary bullish frenzy.
Choppy conditions will likely prevail for the USD/MYR as global investors try to get comfortable regarding their risk appetite. Speculators must keep the coming US Presidential election in mind, which is approaching on the horizon and understand political fireworks can affect forex. However, traders need to remain calm and also take into account that the bearish trend of the USD/MYR is unlikely to waver dramatically and selling of the USD/MYR remains a solid decision for traders who can manage their emotions and roll with slight reversals which may work against them temporarily.
The USD/MYR has displayed an ability to lower its resistance levels as the forex pair remains within its rather solid bearish trend. Near term trading may be challenging due to mixed sentiment as caution swirls, so traders need to understand their view today may not match their longer outlooks. However, speculators who feel risk appetite will emerge sooner rather than later, may want to sell the USD/MYR and continue wager on the forex pair’s bearish trend.
Malaysian Ringgit Short Term Outlook:
Current Resistance: 4.1490
Current Support: 4.1422
High Target: 4.1530
Low Target: 4.1320
