Malaysia’s bonds are coming back in favour but the respite may be brief. The level of the nation’s foreign reserves is coming under scrutiny as investors brace for outflows from emerging markets.
“There has been a rebound of flows into Malaysia bonds after huge redemptions late last year,” said Desmond Soon, head of investment management for Asia ex-Japan at Western Asset Management Co. in Singapore, which oversees US$433 billion. “But considering Malaysia’s FX reserve coverage, the number remains vulnerable to a significant change in global risk appetite.”
Malaysia’s reserves are sufficient to finance 6.5 months of imports, according to data compiled by Commerzbank AG using a 12-month moving average. That compares with 9.9 months for Indonesia, 10.8 for Thailand, 11.2 months for the Philippines, and 21.6 for China.
Bank Negara Malaysia’s reserves amount to just 1.1 times the amount of short-term debt on issue, Commerzbank estimates. The corresponding ratio is 2.8 for Indonesia, 3.7 for the Philippines and 4.3 for India.
Overall, the bias in prices is: Sideways.
Short term: Prices are stalling.
Intermediate term: Prices are ranging.
The projected upper bound is: 4.30.
The projected lower bound is: 4.27.
The projected closing price is: 4.28.
During the past 10 bars, there have been 6 white candles and 3 black candles for a net of 3 white candles. During the past 50 bars, there have been 26 white candles and 17 black candles for a net of 9 white candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 74.4689. This is not an overbought or oversold reading. The last signal was a sell 25 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 48.29. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 34 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 30. This is not a topping or bottoming area. The last signal was a buy 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 0 period(s) ago.
Rex Takasugi – TD Profile
FOREX MYR= closed unchanged at 4.284. Volume was 15% above average (neutral) and Bollinger Bands were 60% narrower than normal.
Open High Low Close Volume
4.284 4.288 4.280 4.284 46
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 4.28 4.28 4.37
Volatility: 2 3 4
Volume: 42 38 36
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.
FOREX MYR= is currently 2.1% below its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of MYR= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on MYR= and have had this outlook for the last 5 periods.
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