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Won may keep support as USD/KRW consolidates after eight-session drop
OCBC notes week-to-date foreign equity outflows of USD 5.1 billion could be limiting KRW gains ahead of the Bank of Korea meeting.
OCBC Bank strategists Sim Moh Siong and Christopher Wong said USD/KRW has consolidated after sharp declines over the past eight sessions, with exporter and month-end USD selling helping support the South Korean won.
They added that a modestly firmer US dollar tone and sizable foreign equity outflows offset some of that support, with foreign equity flows running at USD 5.1 billion lower week-to-date.
The strategists said KRW support remains in place but the pace of appreciation may slow, with attention shifting to the upcoming Bank of Korea meeting, US data, Jackson Hole, and month-end FX flows.
They cited USD/KRW last around 1,384, saying daily momentum is flat and RSI is near oversold conditions, while pointing to support at 1,375 and 1,365 and resistance at 1,390 and 1,397.