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USD/TWD: Falling wedge hints at reversal risk – OCBC

OCBC strategists Sim Moh Siong and Christopher Wong highlight that USD/TWD has been grinding lower, supported by strong Taiwan equities, foreign inflows and robust tech exports. They note Taiwan Dollar (TWD) is re-coupling with the technology cycle and remains fundamentally supported.

🔗 Source

💡 DMK Insight

The USD/TWD’s downward trend signals a strong correlation with Taiwan’s tech sector, and here’s why that matters: With Taiwan equities gaining traction, bolstered by foreign inflows and solid tech exports, the TWD is showing resilience. This re-coupling with the technology cycle suggests that traders should keep a close eye on tech performance as it could dictate the TWD’s strength moving forward. If tech stocks continue to rally, we might see the USD/TWD break key support levels, potentially leading to further declines in the USD against the TWD. On the flip side, any negative sentiment in global tech could reverse this trend quickly, so watch for volatility. For actionable intelligence, monitor the performance of major Taiwanese tech stocks and any economic indicators related to tech exports. A significant shift in these could impact the USD/TWD pair dramatically, especially if it approaches critical support levels.

📮 Takeaway

Watch for Taiwan tech performance and key support levels in USD/TWD; a sustained rally could push the pair lower.

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