The USD/MYR continues to provide speculators with quick hitting changes of value and the past few days of trading are a looking glass into tomorrow’s potential developing storm.
- The USD/MYR currency pair is near the 4.3310 ratio as of this writing.
- The ability of the USD/MYR to move lower today is noteworthy, because the selling of the currency pair continues to demonstrate financial institutions are leaning into a bearish outlook.
- Recent trading in the broad Forex market has seen some USD centric strength, but this occurred as the U.S celebrated a holiday earlier this week and some risk adverse positions were taken.
- Today’s trading has seen the emergence of a weaker USD again against many major currencies.
The renewal of selling in the USD/MYR this morning has returned the currency pair back to important lower realms not seen since February of 2023. The U.S will release vital jobs numbers tomorrow, and if the Non-Farm Employment Change data is weaker than anticipated it will create a dynamic in which financial institutions may believe the U.S Federal Reserve will have to be more aggressive with their interest rate cut on the 18th of September, but that is a big speculative ‘if’.
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Near-Term Volatility to Come in the USD/MYR
Day traders need to anticipate the coming volatility in the USD/MYR tomorrow and into Monday. The Malaysian Forex market will be largely closed when the U.S jobs numbers are reported. The volume traded in the USD/MYR is lighter than other major currencies; this leaves the door open for another volatile reaction early on Monday when the Asian markets open again in full.
The ability of the USD/MYR to remain near lower values is important for technical perspectives and betting against the trend would be dangerous, but day traders may want to sit on the sidelines tomorrow and wait for Monday’s opening to effectively trade the currency pair. There are no guarantees the U.S Federal Reserve will cut its interest rate more than the anticipated 0.25% basis value. If a weaker jobs number is published from the U.S tomorrow, global markets including Forex will become lightning quick as they readjust their outlooks.
Near-Term Correlations and Barometers for the USD/MYR
USD/MYR traders looking for correlations should watch the USD/SGD. Both the Malaysian Ringgit and Singapore Dollar have done remarkably well against the USD over the past few months. Yes, there is certainly volatility to be reckoned with and the need for risk management will be ultra-high for tomorrow and early next week.
- Behavioral sentiment within financial institutions is clearly factoring in a more dovish U.S Federal Reserve, but the USD/MYR is testing important long-term lower values and this may create some choppiness early tomorrow before the U.S data is published.
- Traders should be careful with the amount of leverage they using and use take profit and stop loss orders to protect their money.
USD/MYR Short Term Outlook:
Current Resistance: 4.3360
Current Support: 4.3290
High Target: 4.3470
Low Target: 4.3020
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