Extra gains could encourage USD/MYR to challenge the key barrier at 4.4000 in the short term, suggests Markets Strategist Quek Ser Leang at UOB Group.

Key Quotes

“We highlighted last Monday (07 Feb, spot at 4.3000) that ‘the rapid increase in momentum is likely to lead to further USD/MYR strength towards 4.3250’. We added, ‘the next resistance at 4.3480 is likely out of reach this week’. Our view was not wrong as USD/MYR soared to 4.3300, closed at 4.3290 before rising above 4.3480 in early Asian trade. Not surprisingly, upward momentum has improved further and the risk for USD/MYR this week is still on the upside.”

“There is a strong resistance level at 4.3660, a break of this level could potentially trigger a rapid rise to 4.4000. In order to keep the momentum going, USD/MYR should not breach the strong support at 4.2950 (minor support is at 4.3290).”