USDMYR Technical Analysis

The US dollar was up +0.29% against the Ringgit on Monday and is now trading at 4.5700. The upward movement is due to the release of data from the US Manufacturing PMI, which came in higher than expected (46.4 forecast against 49 real). The US Composite PMI and US Services PMI readings came in slightly lower than expected, but still above 50. Overall, readings above 50 on the PMI tend to show that businesspeople are optimistic about the economic outlook, which could lead to economic expansion. If the economy grows, soon more people will be employed and spending money. This whole scenario tends to cause inflationary pressure on the production chain. And when that happens, the Federal Reserve (FED) may decide to raise interest rates to contain inflation, which causes the currency to appreciate. From a technical point of view, the USDMYR could move up towards the 4.6300 region, where it should find an important resistance region on the daily chart.