- Taking a look at the US dollar against the Malaysian ringgit during the trading session on Wednesday, we've seen the US dollar plummet against the ringgit as the market has been rather noisy. It is worth noting that the market has broken through the 50 day EMA. This of course is a very negative turn of events, and it looks like 4.50 has held as significant resistance as well.
- I don't know if this can stay negative forever, but I do think that the 61.8% Fibonacci retracement level may have had some traders looking to get out from underneath, this long position.
- The real question now for me is going to be the 4.40 level. If we can hold that, perhaps drop there, and then bounce, the stochastic oscillator crossing over in the oversold condition might suggest that we are going to bounce around before too long - maybe between the 4.4 and the 4.5 levels. Anything below the 4.4 level, then I think the market gets aggressively negative.
Wednesday Was Certainly Bad
The candlestick on Wednesday is most certainly negative, but it is worth noting that the U.S. dollar has been somewhat hesitant to sell off against other currencies during the session, and in fact, was positive against several. So, I think you've got a situation where this one might be a little noisy, but at the end of the day, the question will be whether we are settling into a range. I will be watching 4.4 because I think that tells the entire story.
At this point, the markets are still looking very likely to be noisy, but I am looking for some kind of resolution with the 4.4 MYR level, and this is a situation that will have to be monitored closely, as this pair tends to move in its own scenario and speed. A bit of patience will go a long way.
Top Regulated Brokers
Ready to trade our daily Forex analysis? Here's a list of the best brokers FX trading Malaysia to choose from.