Malaysian Ringgit (MYR) Rebound on Higher Crude Oil Price

Malaysian Ringgit (MYR) Rebound on Higher Crude Oil Price
Malaysian Ringgit (MYR) Rebound on Higher Crude Oil Price
Global funds have poured US$485 million (RM2.1 billion) into Malaysian stocks and US$198 million into the Philippines since the end of March as the countries’ currencies strengthened 2% and 0.5%, respectively. That’s a dramatic turnaround considering both declined more than 4% in 2016 and hit decade lows this year.
Global funds have pulled more than US$14 billion from Malaysian debt in the last five months as appetite wilted after inflation hit an eight-year high. A central bank clampdown on trading in offshore non-deliverable forwards also stoked concern about capital controls, though the bank has said nothing is planned along those lines.
Overall, the bias in prices is: Downwards.

Short term: Prices are stalling.

Intermediate term: Prices are ranging.

By the way, prices are vulnerable to a correction towards 4.38.

The projected upper bound is: 4.36.

The projected lower bound is: 4.31.

The projected closing price is: 4.33.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 3 white candles and 5 black candles for a net of 2 black candles. During the past 50 bars, there have been 22 white candles and 24 black candles for a net of 2 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 41.0257. This is not an overbought or oversold reading. The last signal was a buy 0 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 27.02. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 10 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -62. This is not a topping or bottoming area. The last signal was a buy 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 15 period(s) ago.

Rex Takasugi – TD Profile

FOREX MYR= closed up 0.009 at 4.335. Volume was 94% above average (neutral) and Bollinger Bands were 178% wider than normal.

Open   High   Low    Close   Volume
4.330  4.337  4.330  4.335  56

Technical Outlook
Short Term:                Neutral
Intermediate Term:  Bearish
Long Term:                 Bullish

Moving Averages:  10-period  50-period  200-period
Close:                       4.34            4.41            4.31
Volatility:                5                  3                 6
Volume:                  49                35               68

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX MYR= is currently 0.5% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect very strong flows of volume out of MYR= (bearish). Our trend forecasting oscillators are currently bearish on MYR= and have had this outlook for the last 34 periods. Our momentum oscillator is currently indicating that MYR= is currently in an oversold condition.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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