Why the Ringgit’s 3.90‑3.93 Range Could Signal a Hidden Opportunity for Your Portfolio

• The Ringgit is likely to trade in a narrow 3.90‑3.93 band, creating a predictable range for traders.
• Core PCE data this Friday could break the dovish narrative and push the USD higher.
• Technical resistance sits at 3.917, while support hovers around 3.903, offering clear entry‑exit points.
• Geopolitical flashpoints, especially U.S.–Iran tensions, may intermittently boost the dollar and oil prices.
• Comparative ASEAN analysis shows the Ringgit’s stability outpaces the Baht and Rupiah, hinting at a relative‑strength play.

You’re missing the silent signal that could make your next trade a game‑changer.

Why the Ringgit’s 3.90‑3.93 Band Matters for Forex Traders

The Kenanga note highlights a compact trading corridor for the Malaysian Ringgit (USD/MYR) between 3.90 and 3.93. In FX, a tight range reduces uncertainty, allowing disciplined traders to deploy range‑bound strategies such as straddles, butterflies, or short‑term carry trades. The range also reflects Malaysia’s stable domestic fundamentals—steady GDP growth, moderate inflation, and a resilient export sector—while external forces remain the dominant catalyst.

How Core PCE Inflation Data Could Flip the Ringgit’s Trajectory

Core Personal Consumption Expenditures (PCE) is the Federal Reserve’s preferred gauge of underlying inflation because it strips out volatile food and energy prices. Analysts expect a 0.3% month‑over‑month rise on Friday. A stronger-than‑expected print could reinforce expectations of a tighter Fed policy, nudging the U.S. dollar higher against emerging market currencies, including the Ringgit. Conversely, a miss would keep dovish bets alive, potentially allowing the Ringgit to test the lower bound of 3.903.

Geopolitical Tensions and Their Ripple Effect on USD/MYR

Escalating U.S.–Iran rhetoric can cause risk‑off sentiment, prompting investors to seek safety in the dollar and commodities like oil. Higher oil prices benefit Malaysia’s export revenues but simultaneously strengthen the dollar, creating a paradox for the Ringgit. Historically, during the 2019 Gulf tensions, the Ringgit briefly rallied on oil‑related optimism before retreating as the dollar surged on risk‑aversion. Monitoring headlines will be crucial for timing short‑term moves.

Technical Levels: 3.917 Resistance and 3.903 Support Explained

Resistance at 3.917 represents a psychological ceiling where sellers have historically entered, limiting upside. A decisive break above this level could signal a swing toward 3.95, aligning with past episodes in 2016 when the Ringgit broke similar resistance after a surprise Fed rate hike. Support at 3.903, meanwhile, is anchored by recent lows and moving‑average confluence. A breach below could trigger a test of 3.93‑3.95, echoing the 2020 pandemic sell‑off when the Ringgit slid to 4.10 before rebounding on stimulus flows.

Sector and Competitor Landscape: Ringgit vs. ASEAN Peers

While the Ringgit enjoys a relatively tight range, the Thai Baht (THB) and Indonesian Rupiah (IDR) have experienced wider volatility due to political uncertainty and commodity price swings. The Baht’s range has been 34.70‑35.20, and the Rupiah has oscillated between 15,200‑15,800 per USD. Investors seeking lower volatility exposure may therefore overweight the Ringgit, especially in a portfolio that values currency diversification alongside equity exposure to the ASEAN market.

Historical Context: When the Ringgit Stayed in a Narrow Band

In mid‑2018, the Ringgit traded between 4.15‑4.20 for three consecutive months following the U.S. tax reform. During that period, foreign investors capitalized on predictable carry yields, and Malaysian equities posted modest gains. The lesson: disciplined range trading can generate steady returns, provided macro‑risk is managed. Replicating that discipline now could yield comparable outcomes, especially given the current 3.90‑3.93 window.

Investor Playbook: Bull vs. Bear Cases for the Ringgit

Bull Case

• Core PCE comes in below expectations, weakening the dollar.
• Oil prices stabilize, reducing demand for a dollar‑safe haven.
• Ringgit breaks above 3.917 resistance, targeting 3.95 on the back of improved risk sentiment.
• Strategic entry: long USD/MYR at 3.912, set stop‑loss just below 3.903.

Bear Case

• Core PCE exceeds forecasts, prompting a hawkish Fed stance.
• Escalating U.S.–Iran tensions trigger a flight‑to‑quality, boosting the dollar.
• Ringgit fails to hold 3.903 support, sliding toward 3.93‑3.95.
• Strategic entry: short USD/MYR at 3.912, place stop‑loss just above 3.917.

By aligning your position with the prevailing macro narrative and respecting the technical ceiling and floor, you can turn a seemingly narrow range into a source of consistent alpha.