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USD/THB finds momentum, bears fail to break 100-day SMA

  • The USD/THB pair advanced strongly in the session on Tuesday, settling at 36.36 with a rally of 0.80%.
  • The dollar remains firm thanks to the restrained comments from Fed officials.
  • FOMC Minutes, May S&P PMIs, April Durable Goods Orders Released Wednesday.

USD/THB gained momentum on Tuesday and rallied 0.80% as bears exhausted themselves, failing to conquer the 100-day SMA at 36.05. Although the Consumer Price Index (CPI) data for April in the US reflected higher-than-expected inflation figures, the Dollar remains firm while the Federal Reserve (Fed) continues to ask for patience for cuts in guys.

Given the cautious stance of Fed officials and the wait-and-see approach perceived by markets, any immediate moves other than technical swings for the USD/THB pair seem unlikely as it remains at a stable pace. May PMIs will be released on Thursday and April Durable Goods Orders on Friday, which could trigger moves in the pair.

Minutes from the May meeting of the Federal Open Market Committee (FOMC) will be released on Wednesday, which could also trigger volatility. For the moment, markets continue to price in greater odds that easing will begin in September.

USD/THB technical analysis

On the daily chart, the RSI shows a slight bullish trend for the USD/THB pair, moving away from the oversold conditions seen on Monday. The RSI has gained ground, but has not yet left the negative trend zone.

The Moving Average Divergence (MACD) histogram, attached to this analysis, outlines decreasing negative momentum, signaled by the decreasing red bars. Sellers currently dominate the market. However, the decline in negative momentum could hint at a possible balance shift.

USD/THB Daily Chart

The broader perspective reveals a critical view of USD/THB's position relative to its simple moving averages (SMA). The pair's firm defense of the 10-day and 200-day SMAs reveals that the overall trend remains bullish. However, the loss of the 20-day SMA suggests a slightly negative trend in the short term.

Source: Fx Street

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