The strengthening of the ruble on the Moscow Exchange, which had lasted for two weeks, ended in trading on Monday. The dollar rose to a record in 6 weeks, and the euro rose to its highest price since late October after OPEC published its December report on the state of the energy market. Even when oil regained the day’s fall and again rose above $ 50 per barrel of Brent, the ruble continued to weaken and became the worst currency in the EM markets by the end of trading.
Has the ruble turned to the downside, or is it just a short-term decline? Alexander Kuptsikevich, an analyst at FxPro, answered a question from Fortrader magazine.
– So far it seems that this is a short-term decline in the ruble. Its corrective pullback after a violent rally. According to the technical analysis, the RSI was in the oversold area for the USDRUB pair, and the pair’s jump at the beginning of the week gave a formal start to the correction.
Now, short-term traders should closely monitor the dollar / ruble dynamics near 74.10. The 200-day moving average passes at this level, which from an important support level can now become resistance, stopping the correction.
Seasonality is now against the ruble. He is often under pressure at the very end of the year and early January. However, since the beginning of the year, the ruble has already weakened quite strongly, and the dollar is actively losing ground against the main world currencies, which plays on the side of the ruble.
A short-term technical bounce could stretch over the next week or two, potentially sending USDRUB to levels above 74.10. EURRUB may well test the 90 mark for strength, trying to break through from the bottom up.
The breaking of the upward trend of the ruble against the dollar is worth talking about only if the latter rises above 75.0. The baseline scenario is that USDRUB will remain at 73 until the end of the year and decline to 69-70 in the first quarter of 2021.