The USD/SGD pair initially tried to rally during the session on Thursday, but as you can see we ended up forming a shooting star for the day, as the Wednesday session also provided the same type of action. With this, I believe that the 1.40 level above is essentially a “ceiling” in this marketplace as it was previously so supportive. With this, I think that if we can break down below the lows of the session on Thursday, the market should then drop back down to the 1.3750
Looking at this pair, you can see we have sold off rather significantly over the last several weeks, and this seems like we are getting towards the end of a nice bounce that will end up testing the bottom of the previous support level. If we can see resistance there, which it seems as if we are, it makes sense that the market could continue to go lower.
Grinder
Keep in mind that this pair tends to be more of a grinder than anything else, as we don’t get significant moves in short amounts of time typically. Also, you have to keep in mind that we are reaching at the top of the range for the most recent impulsive candle to the downside. In other words, there should be a lot of selling orders in the general vicinity that we now find ourselves in, and it makes sense that it should hold.
Keep in mind that the Singapore dollar is considered to be a bit of a safety currency, and as a result it will do better against the US dollar than other currencies in general during times of uncertainty. That doesn’t mean that it necessarily has to go higher against the US dollar, just that it won’t fall as far. Nonetheless, I believe that this market is going to continue to go lower, and therefore I am a seller until we break well above the 1.40 handle.
