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FXWire Pro Headline  |  February 1 2012 3:23 EST

RESEARCH: Rally in TWD to fade on the release of hard data


Quotes from Standard Chartered:

-The bullish bias with which the Taiwan dollar (TWD) has recently traded is likely to fade as USD-TWD nears a key junction at 29.50, with the 200-day and 50-week moving averages (MAs) both providing support. Since end-2011, the TWD has appreciated from 30.279 to 29.57, a 2.4% move - outpacing the 1.73% move in the ADXY Index and breaking below the 30.00 psychological level.

-Year-to-date, foreign institutional investors have net-bought +USD 1.849bn worth of Taiwanese stocks, with 684mn coming in on the first day of equity trading after the Lunar New Year holidays. Investor sentiment has been buoyed by a positive election result, and by the rally in regional currencies. However, price action in USD-TWD has turned more consolidative on tentative signs of a correction in investor risk appetite.

-We expect the rally in the TWD to fade on the release of hard data, and the return to a focus on deteriorating global fundamentals which will undermine further moves.






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