January 31, 2023 03:16 GMT
1 Month NDF Threatening Death Cross Formation, Spot Supported Sub 30.00
USD/TWD continues to track lower, with spot testing sub 30.00 today. We haven't made a convincing break of this level yet, although the 1 month NDF is already comfortably below this level, last around 29.88. This pair found some support around early Dec lows sub 29.85. Also note this pair is close to forming a death cross forming (50-day MA breaking below the 200-day MA).
- The firmer TWD tone looks to be a little at odds with steady CNH and KRW levels today. However, it looks to be somewhat of a catch up play, see the chart below. The currency has lagged the stronger ADXY tone through January.
- Also note yesterday saw +$2.5bn in net equity inflows. This is the strongest daily inflow since end 2005 and may be aiding currency sentiment still.
- Local equities are down 0.80% today, after yesterday's +3.8% gain.
- Later on, Dec export orders print, the market looks for a -25.0% y/y outcome, -23.4% y/y printed in Nov.
Fig 1: USD/TWD Playing Catch Up With Firmer ADXY (Inverted) Trend
Source: MNI - Market News/Bloomberg
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