Fundamental strength outweighed by persistent selling pressure drives US Dollar vs South Korean Won lower by over 1%

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Us dollar vs won drops 1.04% today

Highlights

The U.S. Treasury kept South Korea on its currency watchlist, citing persistent won weakness despite a rising current account surplus led by robust tech exports.
Significant won depreciation is attributed to elevated foreign investments by Korean institutions and liberalized access for overseas investors to onshore forex markets.
USD/KRW remains under sustained selling pressure with momentum and trend indicators signaling further downside; forecasted range is ₩1,447 to ₩1,473 over the next five sessions.

Currency depreciation persists despite export-driven surplus gains

The U.S. Treasury maintained South Korea on its currency monitoring list, noting the won's significant depreciation despite a rise in Korea’s current account surplus driven by strong technology exports. The Treasury’s latest report observed that the won’s continued weakness diverges from Korea’s improved fundamentals and expanding surplus. Additional contributing factors included increased overseas investments by Korean entities and the National Pension Service’s foreign placements. Korean authorities have also eased restrictions on foreign investor participation in onshore forex markets, though price action has remained under broader selling pressure.

Anton Kharitonov, expert at Traders Union, sees the relentless decline in USD/KRW as a sign of sustained seller control. He notes that despite positive trade fundamentals, the won remains under heavy depreciation pressure, which is intensified by the U.S. Treasury’s persistent monitoring stance. Technical weakness is evident, with prices consistently below major moving averages and oversold momentum readings. Kharitonov is cautious of a false bottom given the 18 sell signals, and sees little evidence of reversal. "Current conditions offer no bullish catalysts — traders should stay defensive against further downside moves."

Viktoras Karapetjanc, expert at Traders Union, believes Korea’s improved fundamentals and growing account surplus provide a strong foundation for the won’s longer-term prospects. He points out that ongoing reforms to forex rules and robust tech export data create room for a future rebound, despite short-term volatility. The underlying bullish structure in longer-term averages still signals opportunity. "With Korea’s fundamentals strengthening, I expect market participants will soon identify favorable setups for a positive correction in USD/KRW."

Parshwa Turakhiya, analyst, highlights that USD/KRW’s short-term sentiment remains pressured by oversold indicators and a lack of bullish momentum. Intraday volatility is contained, yet most signals point to continued sideways or lower action. He sees short-term trading setups focusing around the ₩1,460 support and ₩1,465 resistance. "Given current sentiment and tight volatility, I’d watch closely for any reversal signals near ₩1,460 for nimble short-term trades."

Oversold momentum amplifies declines under multi-timeframe pressure

USD/KRW has extended its decline, trading below the 20-day (₩1,502), 50-day (₩1,517), and 200-day (₩1,482) moving averages. This signals seller dominance and reinforces pressure across short-, medium-, and long-term timeframes. The near-term ceiling is established at ₩1,465 with support at ₩1,460. Despite distant overhead resistance levels highlighting a bearish structure, the long-term alignment between the 50-day and 200-day averages still remains technically bullish. Momentum indicators confirm sustained weakness: the MACD and ADX forecast continued selling, and the RSI (33.03), CCI (-107.64), and BBP (-13.08) all indicate oversold conditions. The pair opened lower by 0.76% and now trades near the day's low, with a modest intraday volatility of 0.51%. Daily movement records a ₩15.31 (1.04%) drop, and no clear reversal signals have emerged.

Earlier, analysts noted that persistent downside momentum and regulatory scrutiny were keeping USD/KRW under sustained bearish pressure. The current technical and macro signals reinforce this position, with traders now advised to watch for a potential break below ₩1,460 as a trigger for further downside toward the ₩1,447 level.

Source of Data: USD Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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