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USD/TWD hit fresh multi-year highs...........>

TAIWAN
TAIWAN: USD/TWD hit fresh multi-year highs Thursday, touching 31.644 before
closing at 31.603. TWD failed to find any respite from the slightly higher than
expected CNY fix, with the CNY/TWD rate also hitting the best levels in a
fortnight Thursday. Tensions between Taiwan and mainland China rose overnight
alongside annual drills held by the Taiwanese military simulating a Chinese
invasion.
-Next major levels of resistance kick in at 31.979, marking the 61.8% fib
retracement for the 33.805-29.024, which would be the highest USD/TWD spot rate
since early 2017.
-Despite the persistent weakness in TWD spot, vols and risk reversals contracts
are relatively unchanged, but options trades continue to gear for further TWD
weakness. Close to $4 in USD/TWD calls have been bought for every $1 in puts so
far this week, with call strikes at 31.65, 31.75 and 31.80 drawing particular
focus.

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