Before going into the weekend the USD/SGD was trading near the 1.34750 mark, which was a value the currency pair had last traversed on the 11th of August. However, the low created last Friday was a momentary flicker of hope for bearish traders, because the USD/SGD surged only a few hours later and touched the 1.35500 ratio ending the week near high water marks.
Yesterday was a holiday in the U.S. and Forex volumes globally were lower than normal, The USD/SGD held onto its short-term value and the price of the currency pair incrementally climbed early this morning. Later today upon the return of U.S financial institutions, smaller traders should be braced for the potential of fast conditions. The USD/SGD has moved above the 1.36000 level as of this writing.
USD/SGD and Dynamic Forces that Dominate its Trading
The USD/SGD is a currency pair that comes under the influence of west and east considerations. Singapore is an important financial hub and it deals with a large amount of transactions with the Chinese yuan. Therefore China’s economic conditions do affect behavioral sentiment and cash holdings of banking spheres in Singapore that are always managing money.
The USD/SGD has traded higher after touching lows late last week in which a slight change of perspective may have been believed to be taking place, but as U.S traders disappeared on Friday to escape for a long holiday weekend it is possible the USD/SGD became more vulnerable to the upside. The USD/SGD also correlated to plenty of major currency pairs which also saw the USD get stronger on Friday. However, the move lower early Friday in the USD/SGD didn’t happen in many currency pairs, meaning there were likely other factors at play in Singapore.
- The current value of the USD/SGD is now testing values seen on the 17th of August.
- It should be noted that the highs for the USD/SGD on the 17th of August touched the 1.36275 mark. The higher realms seen then had last been viewed in late November of 2022.
- Speculators should be cautious today, because as volumes increase later and return to normal a shift of behavioral sentiment could take place.
Traders Selling the USD/SGD Need to be Careful
The USD/SGD does look like it is priced rather high once again based on the notion that nervous sentiment is dominating its trading. Speculators may be tempted to sell the USD/SGD and look for downside. With the return full trading today, speculators need to have full risk management in place if they are going to wager on reversals lower taking place.
This Thursday and Friday could be important days for the USD/SGD as China's economic data and U.S. Federal Reserve rhetoric collide. The trend upwards the past month and a half in the USD/SGD has been challenging.
Singapore Dollar Short-Term Outlook:
Current Resistance: 1.36120
Current Support: 1.35970
High Target: 1.36250
Low Target: 1.35450
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