Summary:
Learn how to analyse and trade USD to MYR. Explore key drivers, technical tools, and risk tips for trading the US dollar to Malaysian ringgit in 2025.
The USD to MYR forex pair—US dollar to Malaysian ringgit—is a favourite among traders seeking opportunities in both emerging and developed markets. With the ringgit's recent strength and the dollar's global dominance, understanding how to analyse and trade this pair is essential for anyone looking to capitalise on currency moves in 2025.
Here's a step-by-step guide to analysing and trading USD/MYR, including the latest market outlook, technical tools, and risk management tips.
The USD/MYR pair reflects how many Malaysian ringgit (MYR) are needed to buy one US dollar (USD). As of early June 2025, the exchange rate hovers around 4.24 to 4.26, with recent forecasts suggesting a stable-to-slightly bearish trend for the pair.
This means the ringgit is holding steady or even strengthening against the dollar, reflecting a shift from previous years of dollar dominance.
1. US Interest Rate Policy
The US Federal Reserve's monetary policy is a major influence. Recent rate cuts in the US have made the dollar less attractive, encouraging capital flows into emerging markets like Malaysia and supporting the ringgit. Further anticipated cuts could continue this trend into late 2025.
2. Malaysia's Economic Performance
Malaysia's economy has benefited from strong foreign direct investment, especially in technology and manufacturing. Robust growth and a stable political environment have increased confidence in the ringgit.
3. Global Trade and Commodity Prices
Malaysia is a major exporter of palm oil, electronics, and energy. Rising commodity prices and healthy trade balances can strengthen the MYR, while global shocks or falling demand may weaken it.
4. Regional and Global Sentiment
USD/MYR is also sensitive to risk appetite in global markets. When investors seek safety, the dollar can strengthen. In risk-on environments, capital often flows to emerging markets, boosting the ringgit.
Technical Analysis
Support and Resistance Levels: Current support is around 4.23, with resistance at 4.25–4.27. These levels help traders identify breakout or reversal opportunities.
Moving Averages: The 50-day and 200-day moving averages are widely followed. No strong crossover signal is present now, suggesting a range-bound market.
Oscillators (RSI, MACD): The RSI is near 40, indicating neutral to slightly bearish momentum. The MACD line below the signal line also supports a cautious outlook.
ATR (Average True Range): Moderate volatility is present, so traders should watch for sudden spikes in either direction.
Fundamental Analysis
Interest Rate Differentials: Monitor Fed and Bank Negara Malaysia (BNM) policy meetings for hints on future rate moves.
Economic Data: Watch for Malaysia's GDP, inflation, and trade figures, as well as US jobs and inflation data.
Geopolitical Events: Tariff news, US elections, and global economic shifts can all trigger volatility in USD/MYR.
1. Range Trading
With the pair trading in a relatively tight range (4.23–4.27), range trading strategies—buying near support and selling near resistance—can be effective. Use tight stop-losses to manage risk.
2. Breakout Trading
If the pair breaks out of its current range, traders can look for momentum trades. A move above 4.27 or below 4.23, confirmed by volume and technical indicators, may signal a new trend.
3. Trend Following
If a clear trend emerges (e.g., sustained ringgit strength or dollar recovery), use moving averages and trendlines to ride the move, adjusting stops as the trend develops.
Position Sizing: Limit exposure on each trade, especially in a moderately volatile market.
Stop-Loss Orders: Always use stop-losses to protect against unexpected swings.
Stay Informed: Monitor economic calendars and news for events that could impact the pair.
Review Performance: Regularly assess your trades and adjust strategies as conditions change.
Analysing and trading the USD to MYR pair in 2025 requires a blend of technical and fundamental insight. With the ringgit showing resilience and the dollar facing policy headwinds, traders should watch key levels, economic data, and global trends.
By combining sound analysis with disciplined risk management, you can navigate this dynamic forex pair with greater confidence.
Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
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