Speculators not accustomed to volatility within the USD/SGD are likely taking a second glance at the Forex pair’s performance the past week. After creating long-term technical lows via the USD/SGD’s value on Thursday, a strong reversal higher took place and the price range is remarkably high. Traders need to take into account that lighter volumes may have a potential effect on the USD/SGD near term, but the pair’s higher range may also entice speculative positions. The rapid change in values the past week of trading within the USD/SGD may prove attractive to speculators.
As of this morning, the USD/SGD is near the 1.33650 mark, which is considerably higher than the low water marks seen late last week when a value of 1.32460 was experienced. After closing near the 1.32730 price going into the weekend, trading yesterday produced a fast ride upwards and the 1.34000 juncture was actually tested momentarily. Reaching the key psychological level of 1.34000 quickly set into motion a flourish of downward momentum and the USD/SGD approached the 1.331000 level.
The sudden volatility in the USD/SGD may have several factors creating turbulence. The possibilities include a programmed trading reversal off last week’s important low water marks, concerns regarding the newly found mutation over the weekend within coronavirus, and financial institutional positioning as the holidays come into view. The quick-hitting changes in value and lightning pace of trading in the USD/SGD are not normal; the Forex pair typically provides rather calm waters which trend politely.
As the USD/SGD traverses higher values this morning, traders should contemplate the long-term bearish trend which still exists technically. Traders should also ask where the greatest potential for directional momentum exists, and after taking technical charts into consideration, the answer seems to indicate that the USD/SGD should resume its downward trajectory near term.
Selling the USD/SGD under present conditions needs to be done using solid risk management, but the current values near the 1.33650 vicinity look intriguing. Speculators may want to use limit orders that short the USD/SGD after a slight rise in value. Resistance up above can be used with tight stop losses while looking for downside action to develop. The USD/SGD will certainly be affected by low volumes because of the holiday trading environment, but the long-term bearish trend remains tantalizing and potentially worthwhile to pursue.
Singapore Dollar Short-Term Outlook:
- Current Resistance: 1.33780
- Current Support: 1.33430
- High Target: 1.34040
- Low Target: 1.33110
