The selloff that sent USD/MYR plunging by 3.06% last week (Friday close of 4.5230) came as a surprise (we were expecting USD/MYR to consolidate between 4.6360 and 4.6880). The outsized decline appears to be overextended, and USD/MYR is unlikely to weaken much further. It is worth noting that the 3.06% decline is the largest 1-week drop since March 2020.

This week, there is a chance for USD/MYR to drop to 4.5100. At this stage, the likelihood of USD/MYR breaking clearly below the major support at 4.4880 is not high. Resistance is at 4.5700, followed by 4.5870.