The USD/SGD has seen a bullish sentiment emerge short term for the currency pair as resistance levels are approached this morning. However, the past week of trading for the USD/SGD has actually been rather consolidated and provided speculators who are patient an opportunity to test their trading skills with limit orders while taking advantage of technical support and resistance marks.
Short term resistance continues to look strong for the USD/SGD around the 1.39750 to 1.39800 junctures and traders looking to sell the currency pair at these higher levels may be making a wise decision. Current price levels for the Singapore Dollar show that it has traded in a relatively tame range between 1.39100 and 1.39600 the past five trading sessions. Consolidation within the USD/SGD offers the ability to carefully put in entry limits and seek profits in both directions for speculators.
Risk sentiment has certainly increased the past few trading sessions globally and yesterday the Singapore Dollar did hit important support near the 1.39100 level before starting to reverse higher early this morning. Asian equity indices have lost a bit of momentum today, but this comes after making moves upwards recently so the pause in risk appetite may prove only temporary. Also lurking in the shadows is developing news from Hong Kong which could certainly have a knock-on effect for Singapore.
Singapore is a sovereign nation; it is not under the auspice of China authority. The stricter national security laws being implemented in Hong Kong cast a shadow over its financial sector which has been a key player in Asia for decades. If questions persist about Hong Kong’s ability to work within the financial boundaries it has enjoyed and concerns mount, Singapore could see a quiet move towards its shores and expand its position as a place perceived as a safe haven to conduct financial affairs in Asia and globally.
The relative consolidated range of the USD/SGD offers traders an opportunity to test their risk sentiment. A positive outlook for Singapore economically could push the Singapore Dollar to better values against the USD. Selling the USD/SGD may prove profitable at its current values, particularly if it begins to touch resistance up above which has proven a solid lynchpin for reversals the past week.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.39750
Current Support: 1.39200
High Target: 1.39900
Low Target: 1.38800
