Halister News

(Bloomberg) -- USD/KRW may rally toward 100-DMA resistance after forming a potential bullish triple bottom in the past two months, Bloomberg strategist David Finnerty writes.

• FX pair has bounced off support at 50-DMA; MACD has risen above signal line and is bullishly looking to rise above zero while slow stochastics are bullish with %D reading of 65 and gaining
• While Bank of Korea will probably leave rates unchanged for its Oct. 13 decision, USD/KRW is being supported by rising expectations of a Fed rate hike in Dec.
  • Fed President Evans said Oct. 11 that policy “may well be changing soon,” repeating an observation he made last week
• BOK is expected to leave its 7-day repo rate unchanged at 1.25%, according to 17 of 18 economists in Bloomberg survey. One economist expects a 25 bps cut
  • Rising household debt along with uptick in Sept. CPI may result in central bank adopting a wait-and-see approach despite declining y/y exports last month
  • BOK Gov. Lee told parliament on Oct. 4 that the effects of a rate cut on consumption and investment have decreased due to factors including a global slowdown. Also said a rate cut can be a valid move if recession concerns arise during the nation’s corporate restructuring
• NOTE: David Finnerty is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.