- The USD/SGD has moved higher in the past day, and the currency pair has provided a rather intriguing technical set of results compared to the broad Forex market.
The USD/SGD is near the 1.28525 ratio as of this writing. Yesterday the USD/SGD fell to a low of nearly 1.28150, but this was still far above the results seen late last Wednesday when the currency pair hit depths around 1.27150 with significant velocity. The dive lower last week took place in the midst of the U.S Fed announcement in which an interest rate cut took place.
However, the spike lower disappeared as quickly as it had emerged, and by Friday highs around 1.28600 were being challenged. Monday’s trading saw selling develop in the USD/SGD and this lasted into yesterday’s lows. But intriguingly the USD/SGD has gone higher after hitting Tuesday’s short-term lows. The USD/SGD remains within sight of long-term lows, but it has produced enticing upside in the short-term which may be seen as a speculative opportunity to sell the currency pair.
The USD/SGD Barometer and Correlation to Broad Forex
The upside movement in the USD/SGD has taken place as other major currencies have actually gained against the USD via technical perspectives in the short-term. Perhaps financial institutions dealing with the USD/SGD felt the currency pair had been too oversold, but the recent short-term move higher may provide an opportunity to inspect technical resistance and consider a potential limited reversal lower.
Perspective will be important in the USD/SGD. If a trader believes the currency pair is a solid barometer because of its stature in international finance as a sentiment indicator, decisions have to be made regarding the past day of trading. The resistance level of 1.28600 is very dominant since the 8th of September. Obviously, there are no guarantees it will hold, but it should be studied, because the U.S will release important data tomorrow which will cause reactions in the USD/SGD.
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Near-Term Temptations in the USD/SGD
The USD/SGD movement higher the past day is worthy of consideration. Tomorrow’s U.S GDP results and Friday’s Core PCE Price Index will light a fire in the USD/SGD and the broad Forex market.
- The known ratios in many currencies pairs in which they traversed before the Fed announcement last week – found volatility in the wake of the Fed decision – and then returned well-practiced values is interesting.
- USD/SGD traders may believe the currency pair is within higher waters which indicates it may be overbought.
- However and dangerously, it may also indicate USD/SGD large players know something others do not.
- Choppy conditions should be expected into tomorrow’s U.S growth numbers.
- If growth numbers remain solid via the GDP and inflation is tame once again, then the USD/SGD could see a bit of a selloff develop in the near-term.
- Traders need to use risk management diligently if they want to pursue the USD/SGD.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.28590
Current Support: 1.28490
High Target: 1.28630
Low Target: 1.28350
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