Weakening THB due to political uncertainty only? will it continue to weaken?

[notrub]

30 06 2023

 

Crystal ball question coming up...  Is the current valuation of the THB only due to recent political problems or is there  deeper problem with the Thai economy?  Exchange to the Euro is as high as it has been for well over5 years.  Given the war in Europe and uncertainty there it is surprising that the Euro is strengthening.   Is the current trend too good to last?  Should I change more than just a couple of thousand now? Yes, I know, 'nobody knows' but it would be interesting to learn your thoughts. Thank you????

[CharlieH]

Banking forum.

 

MOVED

[Mitkof Island]

So much debt in Thailand due to greed and shear stupidity trying to copy foreigners will be their downfall. Only a matter of time before the banks crash. Once again like 1997 begging America to save their A$$e$ again.

[bamboozled]

Come on, man! The Thai economy has no bearing on the Thai baht. Everyone knows that! Nor do political events or sea changes in deeply embedded cultural touchstones. I am being somewhat facetious, I think.

 

Having been here awhile and having tried to gauge the direction of the baht, based on the various factors mentioned above, I have come to see that it's very difficult. You get black swan events in Thailand and the baht appreciates. Well, that's my experience. I'm no financial wizard by any means. Not for nothing is it called Teflon Thailand. Also known as TITs. Together: Teflon Tits. Who knew?

[pomchop]

The tide comes in...the tide goes out.

[KhunBENQ]

1 hour ago, bamboozled said:

Come on, man! The Thai economy has no bearing on the Thai baht. Everyone knows that! Nor do political events or sea changes in deeply embedded cultural touchstones

May 22, 2014

Military coup.

For two months no significant change in EUR/THB (~44.5).
And after that a long period of gain for the THB started (EUR down to 34.5 in March 15, loss of more than 20%).

Markets love stable dictatorships.

Markets hate change/uncertainty.

So I am not quite sure whether the current perspective of change does not affect the rate.

Edited June 30, 2023 by KhunBENQ

[Chivas]

To the OP three simple words

 

"Pound Cost Averaging"  or in your case the Euro

 

If you're happy with the current rate change the monies, If it further rises change more and "Euro Cost average"

 

Its win win.....however do nothing whatsoever and the rate subsequently drops from the current level then its simply lose lose

[Caldera]

It's pretty much impossible to predict. 

[BenStark]

10 hours ago, Chivas said:

To the OP three simple words

 

"Pound Cost Averaging"  or in your case the Euro

 

If you're happy with the current rate change the monies, If it further rises change more and "Euro Cost average"

 

Its win win.....however do nothing whatsoever and the rate subsequently drops from the current level then its simply lose lose

Tomorrow there will be sunshine all day, with rain showers in between.

[ozimoron]

I think the US dollar will weaken soon, so the baht should strengthen. The baht is at a fairly low level to the US, it's most traded zone is around 31 baht over the past fifteen years. From a chart point of view, the baht strengthened significantly from October to January and then reversed course to weaken in a correction. It touched the neckline of its current pattern at the end of February at the current price of 31.3. This week it stole that high at the neck line and will finish the week with a strong rejection wick on Sunday if the current price holds which it likely will being a long weekend in the US. This rejection wick is an evening star pattern and on the weekly is a strongly bearish (for the USD) candle pattern.

 

Against that is that it had a strong bounce off it's last swing low at 32.7 and again bounced off a retest of the 200 week moving average and cleared all the major moving averages. The dollar should be bullish against the baht but there's that candle. I'm probably wrong but I think the baht will strengthen to 32 in the near term. The DXY is also looking weak and the inflation numbers today might reduce the expectations for more than 1 future rate hike in July. In the short term it could go either way but I expect the DXY to show continuation to the downside over the next weeks.

 

There was also strong hidden bullish divergence for the USD at the swing low which is why the baht weakened after January. That has probably now played out.

 

 

 

Edited June 30, 2023 by ozimoron