Baht strengthens but Omicron worries may pull it down again
The baht opened at 33.65 to the US dollar on Tuesday, strengthening from Monday’s closing rate of 33.73.
The Thai currency is likely to move between 33.55 and 33.75 to the greenback during the day, Krungthai Bank market strategist Poon Panichpibool predicted.
Poon said that the baht might weaken because foreign investors sold short term bonds for 35 billion baht in four days as they tried to cut their loss.
Moreover, the market was worried about the “Omicron” variant of Covid-19 that will affect transportation. It will also affect travelling and the recovery of the tourism sector in Thailand.
According to technical signs in the short term, it also said that the baht is still pressured by weakening factors.
Poon added that investors should speculate the gold price in the short term because the gold price might go up from the worry of the “Omicron” variant. Investors who bought on dips previously will sell the gold which will support the baht to not weaken much more.
The key resistance level for the baht would be from 33.80 to 34 to the dollar, which is the level at which exporters might sell the US currency.
The baht’s key support level would be at 33.40, the level some importers are waiting for so they can buy dollars, he added.
Poon said that the currency market will be highly volatile in this period. Business operators should be cautious and use hedging tools to manage the risk.