Emerging Asian currencies slid on Monday on profit-taking after recent gains pushed the units to key resistance levels, and as investors remained cautious ahead of a bond swap between Greece and private investors later this week. "The market is comfortable with staying short on dollar/Asia. But positioning is light, I think. We still have too many European issues unsolved," said a senior dealer at a Malaysian bank in Kuala Lumpur.
"The market kind of separates Greece from other peripherals, and already accepts a worst-case scenario for Greece - a default," said Frances Cheung, senior strategist for Credit Agricole CIB in Hong Kong. Leveraged names and interbank speculators covered short US dollar/Singapore dollar positions. The pair has strong support between 1.2385, the low of October 31, and 1.2410, the low of February 3.
If US dollar/Singapore dollar rises above January-February downward trendline which comes at 1.2590 on Monday, it may test 1.2625, near the high of February 27. The next target would be 1.2715, around the high of February 16. Dollar/ringgit rose on short-covering and the pair is seen rising more as interbank speculators still have short positions to cover, dealers said.
The pair is seen heading to near 3.02 as it has the 38.2 percent Fibonacci retracement of its February slide at 3.0188. Dollar/ringgit also has a 21-day moving average at 3.0183. Dollar/rupiah rose on demand from offshore funds and SBI related bids. The central bank was spotted selling the pair, but weakness in other emerging Asian currencies supported it, dealers said.
Dollar/won rose as offshore funds and local interbank speculators bought the pair with the 1,110 level seen firmly supported amid caution over possible dollar-buying intervention by South Korean foreign exchange authorities. Local importers joined the bids.
Comments
Comments are closed for this article.