May 27, 2016

Brief Information about Foreign Exchange Rate Movement

 

 New York Market

 

EUR/USD rose 0.35% to 1.1194, backing up near 1.12 and pulling away from a 2-month trough of 1.1129. The dollar consolidated after its rally to two-month highs. The dollar index stood at 95.16, from a low of 94.94 seen overnight, continuing to retreat from a 95.66 peak set on Wednesday.

 

GBP/USD dropped 0.18% to 1.4671. The pound slipped to 1.4690, after hitting a three-week high of 1.4738 yesterday. It retreated after data showed business investment in Britain dropping for the first time in three years on uncertainty around the Brexit vote. One-month GBP/USD options, covering the referendum period, rose to 16.5%, the highest since March 2009, from 11% on Wednesday.

 

 Asian Market 

 

Asian currencies strengthened against the dollar as investors took profit on dollar-long positions. Reuters poll showed bearish sentiment towards emerging Asian FX deepened in the last two weeks as speculation of a US rate hike grew. Pessimistic bets on CNY rose to the largest since early February. Sentiment on KRW was worst among regional FX as bearish bets on the currency hit the highest since mid-February. The won fell to its weakest in more than two months yesterday to 1,180 as the Bank of Korea is predicted to cut rates. The MYR saw the largest pessimistic positions since mid-November as a strong dollar caused investors to sell MYR.

 

USD/JPY decreased 0.40% to 109.76. We saw unwinding of long USD/JPY, resulting in JPY gains. April core CPI edged down to -0.30%YoY, the lowest number since April 2013, from -0.1%YoY March. We expect the yen to remain strong as volatility heightens leading up to Fed’s second rate hike.

 

USD/CNY decreased by 0.35% to 6.558. The yuan rebounded against the dollar from a three-month low after the PBOC set its weakest fixing in five years. The yuan mainly strengthened due to the retreat in the dollar.

 

USD/THB decreased by 0.29% to 35.58. The baht strengthened for the second day against the dollar, as investors re-priced the probability of a June hike by the Fed to 28% from 32% earlier.

 

Today Market Direction at 8.30 A.M.

                                     

KBank Technical Analysis

Morning

Rate

Support

Resistance

Trend (Major)

Today's Strategy

USD/THB (Onshore)

35.64

35.50

35.70

Sideway

Sell USD near resistance

USD/JPY

109.92

108.50

110.50

Sideway Down

Sell USD near resistance

EUR/USD

1.1188

1.115

1.13

Sideway Up

Buy EUR near support

EUR/THB

39.87

39.50

40.25

Sideway

Neutral

JPY/THB

0.3242

0.3215

0.3269

Sideway

Neutral

                           

Foreign Exchange Market News
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