USD/TWD: Taiwan dollar gains ground on President Tsai's election victory

Taiwan's dollar is better bid on landslide victory for President Tsai Ing-wen.
Tsai's victory is a stark rebuke to China, which wants the island to accept its rule.

Omkar Godbole FXStreet Contributor

Taiwan's dollar is gaining ground in Asia, possibly in response to a landslide election victory for President Tsai Ing-wen's Democratic Progressive Party (DPP).

The USD/TWD pair has dropped from 29.97 to 29.90 in the last few minutes and risks falling further to Friday's low of 29.86.

A victory for Tsai was expected to provide a short-term boost to Taiwan's currency and stocks. Notably, stocks related to biotechnology and wind energy may chalk out gains on expectations that government support will continue.

Tourism stocks, however, may come under pressure as DPP's victory is likely to keep the island at odds with China, which has tried both military threats and economic inducements to get the island to accept its rule.

Taiwan's dollar may come under pressure if the tensions between the two nations escalate.

Technical levels

Support: 29.86 (Friday's low), 29.84 (Jan. 2 low)

Resistance: 30.016 (Friday's high), 30.13 (Jan.8 high).

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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