Originally published by AxiTrader
Quick Recap
The USD/KRW has been in an uptrend since late September when the broad trend higher in the US dollar began. Since then it has rallied, and then recently pulled back as election jitters knocked the US Dollar lower.
But the Dollar Won lagged the overall US dollar weakness a little and in NDF terms is sitting at 1141 today - clinging to support but looking vulnerable.
What You Need To Know
The Korean economy and political system are facing challenges at the moment.
Growth is slowing down and after the South Korean president recently dismissed the prime minister the president, Park Geun-hye, herself is coming under increased political pressure. That, and the strength in the US dollar makes for an environment which is supportive of USDKRW.
Yet even after a strong rally in the US dollar overnight USDKRW is still resting right on important trendline support from where the most recent rally began in late September.
While my McKenna Mantra is always to respect trendlines and levels unless or until they hold - and remembering I'm running flat until the US election result is out of the way - this set up is certainly one that I am watching for a break and a potential opportunity to sell dollars and buy won.
That's for a number of reasons including the failure at the 200 day moving average recently and the setup aligning via my trading system. Support currently rests with my fast moving average at 1138 and the low of 2 days ago (what a candle) at 1137.
Support currently rests with my fast moving average at 1138 and the low of 2 days ago (what a candle) at 1137.
Here's the Chart:
Have a great day's trading