Societe Generale says USD/KRW has extended its correction after slipping below the 200-day moving average, which sits near 1478. The pair is now probing an ascending trend line in place since 2023 around 1407, a level the bank treats as interim support. Price action suggests a near-term pause, but a move back above 1425 is required to validate a short-term bounce.
If 1407 fails to hold, Societe Generale sees scope for follow-through towards 1388/1385 and then 1375. Elsewhere in Asia, the won (KRW) has led regional performance, though the advance from around 1,560 in early July to near 1,415 is beginning to lose momentum.
Technical Levels And Key Price Action
We are closely watching the USD/KRW pair as it tests a major support line at 1407, following its recent drop below the 200-day moving average of 1478. Derivative traders should prepare for heightened volatility in the coming weeks as this key trend line from 2023 is put to the test. To confirm a reliable short-term bounce, we need to see a decisive break above the recent peak of 1425.
If the pair fails to defend the 1407 mark, we expect the downward slide to target 1388 and eventually 1375. Derivative traders can exploit this potential breakdown by using put options or short futures contracts to capture the downward momentum. This bearish view on the dollar is backed by South Korea’s steady trade surplus, which recently hit a solid $3.2 billion due to strong semiconductor exports.
Risks, Momentum, And Trading Strategies
We must also acknowledge that the Won’s rapid rally from 1560 in July to around 1415 is showing clear signs of fatigue. Historically, rapid currency swings of this scale often trigger short-term profit-taking and consolidation. We suggest using tight stop-losses near 1425 to hedge against any sudden upward reversals.
