There is a good chance that the Indonesian Rupiah (IDR) has found a significant low in September and the current move is likely only a corrective move from the recent high of 13230.
Why are we bullish on the IDR?
We believe that there is a chance that the IDR has completed its 5-wave move from the 2011 lows.
The recent strength in the IDR looks impulsive while the current pullback has a corrective look to it.
Hence, we expect a tad more weakness in the coming weeks, likely towards 13895-14332 next. The 38-62%FR levels come in at 13840-14218.
Falling below the recent swing low of 13543 would likely mean that the next leg of strengthening is underway, targeting 13230 and eventually 12810 next.
If our count is right, then it may even strengthen towards the previous 4th wave extreme at 11254 sometime in 2016 barring a move beyond 14828.
If that happens, then the alternative view is taking place, where a lot more weakness is likely next for the IDR. (Read Report)
Source : CIMB Research