The USD/SGD is near the 1.33695 mark as of this writing as fast conditions are being displayed in the currency pair. The USD/SGD was trading near a high around the 1.34475 mark early yesterday, after last week’s declines which saw a high of nearly 1.36220 on Tuesday. Since the inflation data was published from the U.S last week the USD/SGD has made support levels appear weak and bearish traders who have been anticipating the lower move have likely been given reasons to cheer.
Traders must keep in mind that Forex volumes will become much lighter than normal late on Wednesday (for traders in Asia) as the U.S financial institutions shutter for the Thanksgiving holiday and disappear for a long holiday weekend. The USD/SGD will certainly trade, but volatility caused by thin trading conditions could spark sudden spikes which are not easy to identify and make technical charts rather ineffective. Having broken through the 1.35000 and 1.34000 levels, and having sustained lower price action, speculators are likely looking at the USD/SGD with bearish desire.
USD/SGD Move Lower and Early August Values Reappear
The move of the USD/SGD lower will intrigue technical traders who glance at six month charts, suddenly the Forex pair is near early August values and the 1.33700 level looks to be important. If the USD/SGD can sustain prices below the 1.33700 mark it will set the table for targets below around the 1.33350 ratio.
Financial institutions in Singapore are among some of the best Forex houses in the world when it comes to moving money. Singapore is a major trading hub in commodities and its financial institutions may turn a speculative eye towards bearish positions based on the idea they believe the U.S Federal Reserve is going to begin turning neutral. While targeting lows seen in July of 2023 is far too ambitious for day traders, the notion the USD/SGD can continue to track lower isn’t farfetched.
USD/SGD Risk Management as Lighter Volumes Develop
- Today and early tomorrow will see plenty of price action in the USD/SGD as traders position for the long holiday weekend in the U.S.
- Yes, the U.S. is open for trading on Friday, but volumes will remain low as the top managers stay away from the offices and literally make the less experienced employees monitor trading.
- This means the USD/SGD could move quickly and sudden price gyrations may be hard to interpret going into the weekend.
If the USD/SGD continues to create downward momentum going into Wednesday afternoon it could be a sign further selling will develop. Traders need to use solid risk management and be cautious regarding the ability of the USD/SGD to create price velocity which may become dangerous in the near-term.
Singapore Dollar Short-Term Outlook:
Current Resistance: 1.33810
Current Support: 1.33600
High Target: 1.34075
Low Target: 1.33270
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