USD/THB 1H Chart: Bears expected to prevail
The US Dollar has been trading in an ascending channel against the Thai Baht for the last two months. This has guided the pair from its 2014/2018 low of 31.10 towards the 61.80% Fibonacci retracement at 32.20.
From theoretical point of view, the pair has failed to form a new high this week which might be an early indication of a new wave down. In case the senior channel and the 200-hour SMA are breached at 31.97, the Greenback is likely to depreciate even further down to the 38.20% Fibo.
Given that these retracement lines have worked effectively at reversing the pair during the last week, it is likely that the pair continues respecting this junior channel and therefore reverses back to the upside. The general direction should nevertheless remain south.
Meanwhile, there is still some upside potential in the market that could result in a test of the monthly R3 at 32.30 within the remaining part of this week.
From theoretical point of view, the pair has failed to form a new high this week which might be an early indication of a new wave down. In case the senior channel and the 200-hour SMA are breached at 31.97, the Greenback is likely to depreciate even further down to the 38.20% Fibo.
Given that these retracement lines have worked effectively at reversing the pair during the last week, it is likely that the pair continues respecting this junior channel and therefore reverses back to the upside. The general direction should nevertheless remain south.
Meanwhile, there is still some upside potential in the market that could result in a test of the monthly R3 at 32.30 within the remaining part of this week.