The USDCNH has been in a down trend since March 2020, when the FED started cutting the interest rate for the US Dollar. Now the buyers seem to be back in the game, showing some strength from last week’s price action. In the next days, if the market breaks the 6.4830 to the upside we could see some upward momentum and the price could rise until 6.5850. From a macro perspective, traders should pay attention to the Unemployment rate, release on Friday, whose lower-than-expected reading could bring more strength to the US Dollar in the next few weeks.
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The Malaysian Ringgit has weakened against the US Dollar this Tuesday, reaching the level of 4.1045 during the US session. The markets have been moving sideways in the last few days because of the uncertainty fuelled by the increasing number of Covid-19 infections in Malaysia and doubts over the ability of the Ministry of Health to deal with the new wave. The 7-day moving average of new cases in the country has reached its highest level since February 13th, when 3,153 new cases were recorded. Although a lower-than-expected ISM PMI number caused the Dollar to plunge, the Ringgit could still keep losing ground against the greenback should the number of new covid cases fail to slow down. Only 2.8% of the population has had the first dose of the vaccine so far and unless the rollout of the vaccine speeds up dramatically, we could well see the USDMYR exchange rate rise to 4.15 in the next few weeks.
