Baht expected to drift sideways due to Thai stocks, gold price

The Thai currency is likely to move between 33.25 and 33.45 during the day, Krungthai Bank market strategist Poon Panichpibool predicted.

Poon predicted that the baht would drift sideways. A factor that will cause the baht to strengthen is that the market is in a risk-on state which will also cause the dollar to weaken. Gold selling will also cause the baht to strengthen if the price goes up nearly 1,800 dollars per ounce.

However, foreign investment especially stocks might cause the baht to fluctuate. The baht will weaken if investors sell Thai stocks. In contrast, the baht will strengthen if investors buy Thai stocks. 

Foreign investors are trading stocks this week until basic economy factors are clearly better and companies financial results were better than expected which analysts will decrease the valuation of Thai stocks because they are currently expensive.

The key resistance level for the baht would be from 33.50 to 33.60 to the dollar, which is the level at which exporters might sell the US currency.

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The baht’s key support level would be from 33.10 to 33.20, the level some importers are waiting for so they can buy dollars, he added.

The market is in a risk-on state because companies financial results were better than expected. Investors were also not worried about inflation while the US Federal Reserve officials speculated that the inflation will be high only temporary. Most Fed officials revealed that Fed might use more tight monetary policies if the inflation is at a high level longer than expected in 2022.

Moreover, an alternative asset such as bitcoin hit a new all-time high, which reflects the risk-on state of the market.