The South Korean won hit a three-year high and the Singapore dollar rose to a record on Friday as macro and hedge funds chased emerging Asian currencies ahead of key data from the United States, though technical indicators suggest some of the regional units may be approaching overbought territories.
Most emerging Asian currencies ended the week in positive territory as investors poured money into the region amid easing concerns over the Greek default and slowing global economic recovery. The baht, which has been the worst performer this year because of the domestic political uncertainty, has turned into this week's winner after the general election last weekend.
The 14-day dollar/won and dollar/ringgit Relative Strength Indices (RSIs) fell to their lowest since early May when their RSIs fell below 30, indicating those pairs were oversold. The Singapore dollar hit a record high against the US dollar on heavy demand from macro funds and real money accounts. Swiss and German names were touted heavily buying the city-state's currency after the US dollar/Singapore dollar broke through its previous low of 1.2212.
The Singapore central bank was seen buying US dollars at 1.2200 but pulled off bids, dealers said. The won touched a near three-year peak against the dollar on continuous inflows to the country's stocks and expected demand liked Kookmin Bank's stock in its parent. The ringgit rose 0.7 percent to as strong as 2.9865 on demand from hedge funds and fixing-linked bids.
But the dollar/ringgit found support around the June 6's low of 2.9900, which will create a double bottom formation on the daily charts if it holds. The baht kept rising on heavy demand from real money accounts. Foreign banks, which had sold the Thai currency earlier, turned to buyers.
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