US Dollar Technical Forecast – USD/MYR, USD/PHP, USD/IDR, USD/SGD

US DOLLAR, MALAYSIAN RINGGIT, PHILIPPINE PESO, INDONESIAN RUPIAH, SINGAPORE DOLLAR

• US Dollar rise against PHP, IDR, SGD amidst Nasdaq 100 drops
• The market mood might sour further, risking re-emergence of the market capital flight
• Will Sino-US tensions escalate again?

US DOLLAR ASEAN RECAP

The haven associated US Dollar quickly gained against the ASEAN peers this week with volatility signs resurfacing in the financial markets. The Indonesian Rupiah, Philippine peso, and the Singapore dollar weakened with the technology-heavy Nasdaq 100 falling the most, the past time since March. The dismissal of the US ISM services minutes might have spooked traders, leading to capital flight.

The Singapore Dollar was not able to find key support on the less than gloomy local retail sales information, showing an additional focus on the USD/SGD on the external risks. The significant standout the previous week was the Ringgit that largely outperformed the USD. Many of the gains happened after the reopening of the local markets after the Labor Day holiday. The USD/MYR has already started to trade sideways.

EXTERNAL EVENT RISKS – SECURITY REVIEW COMMISSION, US-CHINA ECONOMIC AND VOLATILITY

The surge in the VIX fear measure might place the US Dollar in the highly volatile month for the US equities. The US stock markets are closed for the Labor Day holiday, thus creating an environment ready for the volatility because of the higher thinner liquidity conditions. Incase last week’s risk aversion continues, we might see the US Dollar regain the lost ground against its ASEAN peers.

The US economic calendar docket seems pretty quiet this week. The investors might start focusing on the Security Review Commission and Sino-china economy on Wednesday. It will most likely hold the yearly hearing this year, of late, US-china escalating tensions rising as we head into the US Presidential elections, especially around technology. More uneasiness between these two powerhouses might improve the US Dollar.

ASEAN – INDIAN INDUSTRIAL PRODUCTION, PHILIPPINE TRADE, BANK OF MALAYSIA

The high-risk event in the ASEAN region might be the Bank of Malaysia interest rate decision that would be made on Thursday. Economic analysts expect that the overnight interest rate might remain the same at 1.75% investors might focus more on the bank’s most recent evaluation on the current economic conditions. The 2nd quarter Gross Domestic Product drop was worse than anticipated. Keeping this in mind, the Ringgit might become weak if lawmakers start paining a bleak image as Gold Prices Attempt to Retrace $2000, Hang Seng and DAX Higher.

Before the Malaysian bank, the USD/PHP is eyeing the Philippine trade information. It’s expected that the exports will drop 9.9 y/y in July. On Friday, the USD/INR will be waiting for the latest data on the Indian industry production. That said, the risks of market capital flight ahead might maintain this focus for the currency.