USD/THB Rebound Continues, Amid Cross Asset Headwinds, RSI No Longer Oversold

USD/THB has rallied strongly since the open, last back in the 36.20/25 region, 0.75% weaker in THB terms. This the weakest performer in EM Asia FX so far today, although some of this is catch up to stronger USD trends seen post yesterday's onshore close.

• We are comfortably above earlier lows in the week (35.82). We are back above the 200-day EMA, with the 20 and 50-day EMAs both closer to 36.37 in terms of further upside targets.
• Broader USD gains, global equity weakness, the pullback in gold prices (off close to 1%) are weighing on the baht in recent dealings. Stability in front end US-TH yield spreads has been evident in this period.
• This puts the USD/THB RSI (14) back into the neutral zone, after being in oversold territory in the middle part of the week.
• The data calendar has weekly FX reserves later, which won't move market sentiment. In the portfolio flow space, we are running positive week to date equity flows (+$41mn), while bonds are up by a similar amount.