As the USD/SGD swims within the lower depths of its mid-term and long term price range, speculators may feel unsettled. Having tested these depths in the recent past, it is clear that reversals higher have sprung, and may have hurt traders in the past who wanted to participate via the bearish momentum which has become a frequent characteristic of the USD/SGD. However, the constant knocking on the door of support at these depths may lead speculators to believe the door will eventually open.
Traders have hopefully been able to take plenty of advantage of the downward movement which has recently been demonstrated. In the first week in April, the USD/SGD was trading near a high of 1.34850, but the Forex pair has been able to re-establish its selling pressure and incrementally bust through support levels as it shows an inclination to traverse back to its important bearish values.
As of this writing, the USD/SGD is trading near the 1.32410 mark and is hovering near vital support within sight of the 1.32350 to 1.32220 junctures. The past week of trading has produced a rather steady trend of selling and the velocity of the move has been rather fast. However, upon touching the lower support junctures, reversals have occurred. What may attract speculators who want to pursue the potential of more downside action is that a reversal higher this morning to the 1.32640 vicinity seemed to cause another swift sell-off.
Resistance levels are beginning to show adequate strength and, if they persist, support junctures below may prove to be rather vulnerable. Technically, the USD/SGD did test the 1.32350 to 1.32200 junctures the second week of this May and the end of April. Before those dates, there were tests lower in January and February of this year. The reversals higher in the USD/SGD from these lower depths often have proven to be strong. So the question is if this time will be different.
If technical and behavioral sentiment combine in the near term, traders may have an opportunity to watch a breakout lower occur. Certainly, the bearish trend is not guaranteed to continue forever, but from a technical viewpoint, the values being traded at this moment may be indicating that there is additional ground to cover below. Selling the USD/SGD by using slight reversals higher to ignite short positions and aiming for support levels may prove to be a worthwhile speculative wager today and tomorrow.
Singapore Dollar Short-Term Outlook:
Current Resistance: 1.32560
Current Support: 1.32350
High Target: 1.32760
Low Target: 1.31910
