The USD/SGD is testing important mid-term resistance early today and this has developed after the Singapore Dollar has been affected by important technical and behavioral sentiment which is causing choppy conditions. On the 10th of May the USD/SGD was trading near 1.32330 and appeared to be signaling it could challenge values below which were experienced in late February.
However in the past week there has been negative news regarding coronavirus in Singapore which has certainly caused a temporary shift in behavioral sentiment. While trade numbers from Singapore, and inflation concerns are being heard in the US, traders should remain focused on the range the USD/SGD is displaying. Speculators have a solid value band to consider as this week of trading begins which may prove advantageous.
Resistance junctures of 1.33750 to 1.33850 may be important. Late last week the USD/SGD did come close to the 1.33840 mark briefly, while a high near the vicinity of 1.33920 was seen on the 4th of May. After reaching those highs, the USD/SGD reversed lower and eventually touched the lows on the 10th of May mentioned above. While present support near the 1.33330 price looks more realistic as a target compared to values near 1.32500 in the short term, traders need to keep in perspective the USD/SGD has been persisting within a long term bearish trend.
However taking a look at long term charts and trying to find clues for today and tomorrow remains tricky, instinctively technical traders may believe pursuing momentum may be the best wager instead of trying to finds spots where reversals will occur. The present value of the USD/SGD leaves it relatively within the middle of it three month range. If resistance is challenged and punctured higher, through the 1.33850 mark traders may believe the USD/SGD can go higher.
Significantly, if traders continue to believe bearish sentiment will become dominant again, perhaps they should look at the 1.33500 level as a key psychological indicator short term. If values are sustained beneath this level, traders may believe the USD/SGD has the ability to aim for the 1.33350 mark. Selling the USD/SGD for traders who feel momentum will develop towards the downside may prove to be appropriate, but stop loss and take profit orders are encouraged because choppy conditions may remain prevalent early this week.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.33750
Current Support: 1.33330
High Target: 1.34170
Low Target: 1.33110
