The Taiwan Dollar (TWD) has recently shown signs of moderating weakness against the US Dollar, according to OCBC’s Christopher Wong. This moderation is attributed in part to guidance from the Central Bank of the Republic of China (CBC), which instructed banks to execute large USD sell orders immediately upon receipt, rather than delaying or staggering them. This policy move is believed to have brought forward natural USD supply, thereby tempering the pace of TWD depreciation [1].
Despite this intervention, the overall flow environment remains challenging for the TWD. Foreign equity selling has amounted to USD 4.3 billion week-to-date, and ongoing dividend and remittance-related USD demand continue to restrain any significant TWD recovery. As a result, the market is experiencing two-way moves in the USD/TWD pair, with the risk of a pullback still present [1].
From a technical perspective, bullish momentum on the daily chart remains intact, although the Relative Strength Index (RSI) has retreated from overbought conditions. Key resistance levels are identified at 32.22 (the 76.4% Fibonacci retracement of the 2025 high to low) and the 32.50/60 range, while support is noted at 31.95 and 31.78 (the 21-day moving average) [1].
No forward-looking statements or analyst opinions beyond the technical outlook and policy-driven flows were provided in the source article [1].
CONCLUSION
The Taiwan Dollar's recent weakness is showing signs of moderation due to central bank policy actions, but persistent foreign outflows and USD demand continue to limit recovery. Market participants should expect two-way trading in the near term, with technical levels providing key guidance. The overall sentiment remains cautious as the broader flow backdrop has not turned decisively positive.