USD/MYR: Geopolitics and Oil risk steer Ringgit – OCBC

OCBC strategists Sim Moh Siong and Christopher Wong highlight that easing Oil prices, a softer Dollar and a firmer RMB aided partial Ringgit recovery. The outlook hinges on Middle East tensions and Oil supply disruptions, with key support at 3.9150/80 and 3.90, and resistance at 3.9550 and 3.9760 on the daily chart.

Middle East path drives MYR scenarios

"Focus remains on Iran conflict, where developments remain fluid and the outlook for MYR will largely depend on how the situation evolves. A key consideration is the duration and scale of potential oil supply disruption. If tensions in the Middle East ease and risks to shipping routes and production remain contained, the oil risk premium could unwind relatively quickly."

"In such a scenario, further recovery in risk sentiment should support MYR recovery. However, if tensions remain heightened, like how Iran is telling the world to prepare for USD200/bbl, then risk appetite may stay restrained and the MYR recovery seen in early week may stall, regardless of oil/commodity dynamics."

"Bullish momentum on daily chart is fading while RSI fell. Immediate support at 3.9150/80 levels. Decisive break below puts next support at 3.90, 3.88 levels. Resistance at 3.9550, 3.9760 (50 DMA)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)