The USD/SGD has challenged the long-term notions of its rather exuberant bearish trend the past couple of weeks. The USD/SGD’s climb to higher levels with swift volatile price action certainly tested the fortitude of traders if they were on the wrong side of the Forex movement. However, the past two days have begun to exhibit technical signs that the USD/SGD may be ready to confront support levels.
Speculators who have been chasing the belief that the USD/SGD will resume its downward trend have likely found rough days as the Forex pair crushed resistance and attacked key mid-term highs. The value of the USD/SGD, which has been dominated by a strong downward trajectory and was testing low water marks not seen since the spring of 2018, was suddenly brought to a halt towards the end of February.
Experienced traders know Forex is never a one-way avenue and long-term trends will always have cyclical battles fought in which reversals are displayed and sometimes can become prominent. The past two weeks of trading within the USD/SGD has illustrated this for speculators abundantly. After hitting a low of 1.3165 approximately on the 25th of February, the USD/SGD has slammed higher and caused problems for traders with bearish sentiment. A high of nearly 1.35310 was touched two days ago.
Speculators certainly need to be cautious as the USD/SGD proves it is susceptible to sentiment created in the global markets, but they should also feel content because the price action seen the past two weeks is a healthy reminder that fundamentals and technical charts work together. The USD/SGD has gone through a rough short-term bullish reversal and now may be ready to resume a downward slope.
Traders should certainly use limit orders to guard against the chance that another dose of volatility will hit the USD/SGD. However, global markets have begun to demonstrate a willingness and ability to reignite bullish behavior in the major equity indices this week and record highs are within sight again on many of the most important stock exchanges.
The USD/SGD will likely benefit from this renewed optimism being generated and financial institutions may begin to believe that the Forex pair has the ability to trade lower. Speculators may be tempted to sell the USD/SGD and look for support levels to work as solid targets to place take-profit positions.
Singapore Dollar Short-Term Outlook:
Current Resistance: 1.34530
Current Support: 1.34250
High Target: 1.34670
Low Target: 1.34010
