The USD/TWD collapses while the Taiwanese dollar records a historical increase amid commercial speculation

• The pair quotes about 28.95 after a two -day collapse that exceeds 10%, caused by the speculation that Taiwan is revaluing the TWD.
• The broader currency rally in Asia is driven by bets that regional currencies will be allowed to strengthen to obtain commercial concessions from the United States.
• The technical bias becomes markedly bearish; The USD/TWD quotes about three years with support in 28.80 and resistance around 29.60.

The USD/TWD collapsed in the 28.90 zone on Monday, deepening its historical collapse after a 5.7% drop that joined the 4.4% fall on Friday. The two -day rally of the Taiwanese dollar of more than 10% is the most acute in more than three decades and has triggered a broader speculation that Asian economies can be allowing their coins to be appreciated to gain advantage in commercial negotiations with the US.

Although Taiwanés Central Bank denied the intervention or coordination with the US, Governor Yang Chin-Long was forced to hold a rare press conference, reaffirming that there have been no discussions about the exchange rate with Washington. However, the markets interpreted the passive position of the Central Bank – together with the speculative capital entries of the exporters – as an unofficial green light for the appreciation. This movement led TWD to its strongest level since mid -2022, amplifying volatility in Asia’s currencies.

This dynamic moved to other important currencies in the region. The US dollar fell 0.7% against the Japanese Yen and the Australian dollar, with the latter reaching a maximum of five months. The Chinese yuan in the offshore market played a six -month peak in 7,1881 before cutting profits. The feeling of the market is quickly changing with the belief that the maximum tariffs of the administration of President Trump may have been left behind, which drives a rebound in risk -sensitive assets and currencies of emerging markets.

In the US, economic indicators remain mixed. The ISM Services PMI rose to 51.6 in April, and non -agricultural payroll surprised in 177,000, although the broader uncertainty around tariffs and Fed’s policy continues to weigh on the dollar. The markets are still valuing rates cuts later in the year, although at a slightly slower pace than last week.

Technical analysis

From a technical point of view, the USD/TWD is in free fall. After breaking multiple support zones, the PAR is now close to minimum of three years. The immediate support is located at 28.80, followed by 28.60 and 28.40. The resistance will probably arise around 29.60, 29.90 and 30.20. Momentum indicators confirm the bearish bias, and less than the Taiwanese authorities intervene or commercial rhetoric changes materially, a greater fall can be ruled out.

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