Maybank FX Tech Weekly for 7 Apr 2014

Week Ahead Outlook:

Asia will have its turn to react to the US NFP data on Mon but focus should quickly shift towards China with the next run of data due this week. Off for one day to observe the Tomb Sweeping Day and back on Tues, China’s trade numbers will be on watch followed by liquidity and inflation numbers in the course of the week. Concerns over China’s slowdown are high and the mini stimulus announced by the State Council will take time to boost the economy. The package unveiled also underscored Beijing’s concerns on short-term growth and potential impact on employment. CNY may see further weakness and rest of emerging markets will not be spared should growth of China eases too fast. Apart from Chinese data, BI makes policy decision on Tue. Position adjustments have already started as IDR steadied.  Apprehension over the upcoming elections is also likely to keep aggressive bets away. More central bank meetings from developed market economies as BOJ and BOE also decide on monetary policy rate. Both are not expected to announce any move to their respective policy rates. Elsewhere, Australia releases NAB business surveys and labour report. Any deterioration on that front could drag on the AUD.  Mar FOMC Minutes may grab the limelight for a moment but we do not expect fresh cues. All in all, the USD/AXJs are likely to trade with an upside bias should dollar strength resurface after the NFP release tonight.

SGD $NEER is now 0.24% above the implied mid-point of 1.2665 with the top end estimated at 1.2412 and the floor at 1.2918. 1Q GDP is due and semi-annual monetary policy meeting could happen anytime within 11-14 Apr. Our call is for a no change but inflation fears could be flagged. Hence, we expect SGD NEER to remain at the stronger end of the band for much of Apr.

Dollar Index – Upside Risks. Bulls need to make a sustained move above 80.50 and make a daily close north of this level to gain control. Next barrier is seen at 80.829.

USD/SGD – More upsides cannot be ruled out but we expect upsides could still be slowed by 1.2680. Prefer to enter short position at 1.2680 to target 1.2458 within the month. Stoploss marked at 1.2715.

USD/MYR – Settling in range.Pair may be settling within the 3.2750-3.2903 range. More aggressive bids to meet next hurdle at 3.3000.

AUD/SGD – Choppy. Cross needs a strong move above  1.1720 to extend upsides. Otherwise, expect rangy trades to dominate within the current 1.1620-1.1700 band.

SGD/MYR – Short-term Uptrend. A upward sloping trend channel has formed for the pair and we see strong propensity for the cross to try above the 2.60-figure this week.

Currency	Direction	Support/Resistance	Key Data and Events This Week
Dollar Index		S: 79.90; R: 80.83	·         Mon:  Fed’s Bullard to Speak on Monetary Policy in Los Angeles ·         Tue: Fed's Kocherlakota to Speak in Minnesota; Fed's Plosser Speaks on Bank Regulation in Philadelphia; ·         Wed: MBA Mortgage Applications (Apr-04);  Fed Releases Minutes from March 18-19 FOMC meeting; Fed's Evans Speaks at Conference in Washington; ·         Thu: Initial Jobless Claims (Apr-05);  Continuing Claims (Mar-29); ·         Fri: Univ. of Michigan Confidence (Apr P)
EURUSD		S: 1.3573; R: 1.3770	·         Mon: EC ECB's Mersch Speaks in London; EC ECB Publishes Annual Report; EC ECB's Constancio speaks in Brussels; ·         Tue: – Nil – ·         Wed: EC ECB's Weidmann Speaks in Berlin; ·         Thu: FR Industrial Production  (Feb); IT Industrial Production (Feb); ·         Fri:  EC ECB's Constancio speaks in Washington; GE CPI (Mar F);
AUDUSD		S: 0.9147; R: 0.9260	·         Mon: – Nil – ·         Tue: NAB Business Confidence (Mar); NAB Business Conditions (Mar); ·         Wed: Westpac Consumer Conf SA (Apr); Home Loans (Feb); ·         Thu: Unemployment Rate (Mar); ·          Fri: – Nil –
GBPUSD		S: 1.6537; R: 1.6680	·         Mon: Halifax House Prices (Mar); ·         Tue: Industrial Production (Feb); Manufacturing Production (Feb); ·         Wed: – Nil – ·         Thu: Bank of England Bank Rate (Apr-10); BOE Asset Purchase Target (Apr); ·         Fri: – Nil –
USDJPY		S: 103.16; R: 103.90	·         Mon: – Nil – ·         Tue: BoP Current Account Balance (Feb); Trade Balance BoP Basis (Feb); BOJ 2014 Monetary Base Target (Apr-08); Bank of Japan Monetary Policy Statement;           ·         Wed: Bank of Japan's Monthly Economic Report for April; ·         Thu: Machine Tool Orders (Mar P); ·         Fri: Bank of Japan March 10-11 meeting minutes; Domestic CGPI (Mar);
USDSGD		S: 1.2587; R: 1.2680	•      Mon: – Nil – •      Tue: – Nil – •      Wed: – Nil – •      Thu: GDP (1Q) •      Fri: – Nil –
USDMYR		S: 3.2750; R:3.2903	•      Mon: – Nil – •      Tue: – Nil – •      Wed: – Nil – •      Thu: Industrial Production (Feb) •      Fri: – Nil –
USDPHP		S: 44.495; R: 45.154	•      Mon: – Nil – •      Tue: – Nil – •      Wed: – Nil – •      Thu: Exports (Feb) •      Fri:  – Nil –
USDIDR		S: 11300; R: 11500	•      Mon: Bank Indonesia (8 Apr) •      Tue: - Nil - •      Wed: - Nil – •      Thu: - Nil – •      Fri: - Nil –

Rgds,

Maybank FX Research

Global Markets

Maybank