USD/SGD: Resistance Levels Challenged Again and Low Volumes

Robert Petrucci

The USD/SGD remains within sight of important resistance and trading volumes are low due to the long holiday weekend.

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The USD/SGD has produced a slight push higher in early trading today and speculators need to understand that volumes are thin in the broad markets due to the long holiday weekend. The USD/SGD remains within sight of important resistance but it could safely traverse upwards technically without causing too much of a stir because of past results the last few weeks. The past month has seen a steady increase in bullish momentum generated and this may be causing long-term speculators with bearish sentiment to contemplate changing their perceptions and going long instead.

Essentially since the end of February, when financial institutions began to contemplate the US stimulus packages being brought forward, the USD has begun to see a strong change of direction against many major currencies, including the Singapore dollar. This has occurred as a shift has been seen in US bond yields as investors pile into the US treasury market because higher interest rates have produced. However, the question speculators need to consider is if this change in direction for the USD is a new long-term track which will continue to ensue, or if another sudden shift may be about to happen.

Speculators really do not need to answer this question, because the direction for short-term traders is always changing. While the current momentum of the USD has been strong, it is perhaps time for USD/SGD speculators to simply follow the trend until it relents. Having touched the 1.34850 to 1.34900 junctures above fairly consistently during the month of March and even trading past the 1.35000 level, traders may want to contemplate another wager on upside potential.

Trading volumes will remain low today and until mid-day tomorrow as many investors take advantage of the long holiday weekend. There is an opportunity for traders to enter the market and wager on their technical perceptions, and wait for a flurry of transactions when full volume hits Forex tomorrow and perhaps causes a sudden wave of volatility.

Short-term traders should be careful today and use limit orders because the low volumes in the marketplace could cause sudden spikes. However, if speculators buy the USD/SGD based on the notion that more upside momentum could flourish and resistance levels will be challenged again, the decision cannot be faulted using slight pullbacks towards support as spots to place long positions.

Singapore Dollar Short-Term Outlook:

Current Resistance: 1.34680

Current Support: 1.34560

High Target: 1.34810

Low Target: 1.34460

USD/SGD

Robert Petrucci
Robert Petrucci has worked in the Forex, commodity, and financial profession since 1993. Important aspects of his work involve risk analysis and advisory services. As an advisor in a Family Office he maintains a conservative approach for wealth management and investments. Robert also works in private finance with investors and companies delivering financial and management services.

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