THAILAND SET INDEX

Emerging market equities are challenging their long-term moving averages. Breakdown below these critical long-term support levels could result in sharp corrections. Since the first quarter of 2013 we have seen weakness in emerging market currencies and their equity indices. Thailand was one of the best performing emerging market over the past 4 years. Though a correction could be as sharp as the upward trend. SET Index is now testing the 4 year-long trend line support and the 200-day moving average. Breakdown below these strong support levels could result in a deep correction towards 1,100 levels. USD/THB is already off its lows and well above its 200-day average. Strong support area for the USD/THB is between 30.4 and 30.8. Current technical outlook is negative for Thai Baht and the Thailand SET Index. Unless the equity index recovers above 1,500 levels, downward pressure will remain intact.