The USD/SGD while maintaining its lower price range the past handful of days has also produced rather serious sideways trading, allowing technical traders an opportunity to pursue support and resistance.
The USD/SGD is trading within sight of the 1.28600 level as of this writing. Last Thursday a low of nearly 1.28175 was flirted upon, but this did not come close to challenging lower values seen on the 26th of May when the 1.28000 was touched briefly. The past few days of trading in the USD/SGD has seen a sincere sideways trend emerge. Short and near-term traders may believe they have an opportunity to take advantage of support and resistance levels.
However, before traders get too over confident, they should remember that Consumer Price Index data will be published in the U.S today, and tomorrow Producer Price Index numbers will follow. If inflation reports are lower than forecasted this could propel some lower momentum in the USD/SGD, but financial institutions which have already leaned heavily into a weaker USD may turn cautious even if U.S inflation only meets today’s expectations.
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Trade Tariff Negotiations Between China and the U.S
News has developed over the past day that China and the U.S are drawing closer to an agreement that should lower the rhetoric between the two nations. Rare earth metals trading were a part of the announced tactical agreement yesterday, and the nations have until early in the second week of August to supposedly conclude their dialogue according to reports. News that China and the U.S are talking in a positive manner will certainly help keep investors and financial institutions more calm.
The USD/SGD is traversing long-term support ratios. While in recent weeks the 1.28000 level has been flirted, the last time the currency pair traded below theses depths in a sustained manner was in September and October of 2014. Day traders who want to dream about the potential of the 1.28000 vicinity seeing additional tests are justified, but they should not bet on overly ambitious targets. The 1.28550 to 1.28750 ratios have seen plenty of action recently, thus creating near-term sideways price action.
Speculative Short-Term Trading
The USD/SGD is a solid Forex currency pair to pursue because of its lack of strong volatility, relatively good volume and reputation for producing reliable spreads.
- Traders who choose to pursue the currency pair could continue to try and use resistance levels in the near-term as potential locations to look for downside price momentum, but they should not get too greedy regarding profits.
- Reversals are a natural part of the USD/SGD.
- When a trader has attained their targets goals, they should not overextend their betting unless they can maneuver their risk management via stop losses effectively to make sure they do not let winnings vanish into thin air.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.28725
Current Support: 1.28550
High Target: 1.28820
Low Target: 1.28475
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