Short-term traders who have been suspicious about the USD/SGD’s recent strong bearish path may grow more speculative.
The USD/SGD has managed to sustain its values which it captured in the afterglow of the US elections. The forex pair challenged important support below and then reversed higher, but it has largely shown the ability to maintain its bearish value range, which it has reignited. Cautious traders may grow more speculative as the Singapore dollar proves capable of challenging support levels.
Trading has remained fast in the USD/SGD and both support and resistance levels have proven magnetic from a technical perspective. The 1.34000 psychological value target has proven to be difficult to approach but this is not a new development, the level certainly remains within the sight of speculative sellers. Global risk appetite appears calm and gains made early in the week have not vanished, meaning that profit taking on equity indices has not emerged.
Forex will remain shadowed by US election euphoria the next week or so and traders of the USD/SGD may find opportunities to take advantage of optimistic opinions. However, speculators will also want to note the Singapore dollar is traversing important support levels it has challenged the past couple of years – yes, years – and has not been able puncture with a solid thrust lower. The last time the USD/SGD sincerely traded near the 1.34000 juncture was May 2018.
Short-term traders need to find perspective, and a look at a five-day chart may provide some insight. The USD/SGD has certainly engaged in a serious bearish trend and the question is if the momentum can be sustained or is the Singapore dollar about to embark on a steady diet of testing its current range in the immediate future. Short-term speculators may believe, after taking into consideration the inability of the USD/SGD to break a long-term support level, that betting on another strong downward surge would be wrongheaded.
However, traders can take advantage of the current range of the USD/SGD by acknowledging bearish sentiment exist but may remain hard to break targets far below the current value band. It may prove worthwhile for speculators to search for reversals higher and then to sell the USD/SGD. Looking for a selling target within the 1.34780 to 1.34830 may prove a solid speculative short-term endeavor.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.34800
Current Support: 1.34550
High Target: 1.350200
Low Target: 1.34200