Forex globally yesterday produced a nervous atmosphere and the US Dollar was pursued as a hedge against perceived risk short term as stock markets gyrated. However, with one seemingly ‘easy’ announcement the U.S Federal Reserve changed market sentiment saying it would buy US corporate bonds on an individual basis.
The USD/SGD tested important resistance yesterday as the Singapore Dollar lost value. The currency pair approached the 1.3980 juncture before reversing off of its weakest short term values. Then the Singapore Dollar began to break support levels downward and is now again putting the 1.3850 mark into sight as a target. The Singapore Dollar finds itself in a choppy range punching along 1.3900 values as of this writing.
The Singapore Dollar has shown a significant amount of strength since April and continues to show it is capable of adding more value. Traders who look at technical charts may want to look at a weekly chart and understand its recent range. Important support for the Singapore Dollar appears to be the 1.3800 value. This juncture has not been touched since the second week of March.
Short term traders have a range which they can take advantage of today if they do not want to hold positions for a lengthy amount of time. The 1.3900 to 1.3920 marks appear to be good entries for a speculative selling position with a target of 1.3880 down to 1.3850 for a quick trade to chase the potential for a stronger Singapore Dollar.
Global markets are trying to rebalance themselves. Conditions in forex have been nervous with plenty of swings short term as major stock indices struggle with a variety of news which is creating quick reversals. However, the choppy conditions in forex can provide short term traders solid opportunities if they use stop losses, take profits, and manage their use of leverage effectively. The USD/SGD offers traders an ability to use technical entry points today and seek short term gains in an effective manner. The mid-term trend for the Singapore Dollar has been stronger overall and today may be a chance to short the USD/SGD.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.3920
Current Support: 1.3850
High Target: 1.3960
Low Target: 1.3820
