It is important while trading to always remember past results do not guarantee what is going to take place in the future. Speculators who have been riding the bearish trend of the USD/SGD have likely found successful trading results the past five days. While support levels for the Singapore Dollar have been beaten and the USD/SGD continues to mount an attack on values below, adding selling positions of the forex pair blindly would be a poor tactical decision.
In early trading this morning, the USD/SGD continued its downward track and tested support near the 1.36350 level. There has been a slight reversal higher, but the Singapore Dollar has certainly not seen a violent spike upwards and remains in the territory which indicates further selling of the USD/SGD can be displayed. However, speculators must remain alert to the possibility of the strong bearish action of the forex pair will produce moves that will challenge the prevailing trend and put their risk management to the test.
Having gotten the warning about the USD/SGD’s potential for a sudden bullish cycle to emerge; traders should continue to focus on the bearish trend and try to take advantage. The USD/SGD is trading in territory it has not traversed since late January of this year.
Importantly, the Singapore Dollar’s support junctures being approached are within striking distance of a trading range the USD/SGD tested before the full impact of Coronavirus implications changed the global trading landscape. The current price range of the USD/SGD should be carefully considered because a bearish trend has certainly been in full effect. Experienced traders know that reversals against the trend are natural and need to be expected, but they also know going against the dominant trend can prove costly.
Selling the USD/SGD remains a solid decision. However, traders need to understand the support levels being tested and which admittedly appear vulnerable, could prove an important inflection point, and cause buying to emerge via programmed trading software which may test the forex pair’s value with sudden bullish momentum.
Support near the 1.36340 level yesterday and early today proved capable of launching reversals higher. However, if this support juncture breaks downwards and momentum is sustained the USD/SGD could target values near the 1.36200 mark and below. Global sentiment appears strong and while pullbacks caused by profit-taking should be expected, risk appetite may continue to generate more bearish momentum for the USD/SGD.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.36630
Current Support: 1.36330
High Target: 1.36740
Low Target: 1.36140
