USD/THB risks further retracements – UOB

Quek Ser Lean at UOB Group’s Global Economics & Markets Research noted USD/THB could depreciate further in the coming periods.

Key Quotes

“Our expectations for USD/THB to trade sideways last week was incorrect as the break of 32.96 led to a sharp and rapid decline. Note that USD/THB closed below the 55-day exponential moving average for the first time since mid-June last Friday.”

“While shorter-term conditions are oversold, the rapid and impulsive decline suggests that there is room for further USD/THB weakness.”

“However, the next major support at 32.26 (50% retracement of the 2-month rally from 31.03 to 33.49) could be out of reach this week. Resistance is at 32.67 but only a break of 32.84 would indicate that the current weakness has stabilized.”