The USD/SGD dove lower in late trading yesterday, and continued its search for new depths early this morning.
The USD/SGD is trading near the 1.35600 level as of this writing, the last time the currency pair traded within it current vicinity in a sustained manner was in April of this year. The USD/SGD has seen a rapid decline produced since late yesterday, and momentum has been sustained downwards this morning as long-term support comes into consideration.
U.S. Federal Reserve Chairman Powell ignited Forex markets yesterday when he spoke about the likely need to become more ‘dovish’ regarding U.S. interest rate policy. Like an early Christmas, financial institutions acted like children being given the pleasure of opening their gifts early. The USD weakened across many of the major currency pairs and the USD/SGD has reflected this mode of price action.
Confirmation of Different Path by U.S Federal Reserve helps the Singapore Dollar
Speculators of the USD/SGD who use technical perceptions may want to click onto a one year chart. Yes, the USD/SGD has traded lower over the past couple of months. On the 28th of September the USD/SGD was near the 1.44800 ratio. However, the track lower was incremental in nature until the 3rd of November with polite selloffs testing support levels, but a bearish trend in the first week of November to gain strong behavioral sentiment. One year charts are now needed to look at potential lower values.
- Yesterday’s high in the USD/SGD around the 1.37500 ratios may be put into the rearview window if current values remain sustained. Current support for the USD/SGD is around the 1.35500 level and if broken lower targets could become attractive quickly.
- The confirmation of a less aggressive Federal Reserve confirmed the suspicions of many global financial institutions which have been selling the USD aggressively the past handful of weeks. Now that their belief has been proven correct, price velocity lower may start to actually slow.
Having heard from the Federal Reserve USD/SGD Traders Should be Cautious
The price velocity lowers the last day of trading has been substantial. The confirmation of a less aggressive U.S central bank policy raises the chance that resistance levels above will become more durable. Having seen a solid decline in values the past few weeks and a large move lower the past twelve hours, perhaps the USD/SGD will begin to see a slower consolidated price emerge.
Traders should not be overly aggressive sellers in the short term and be careful to keep their dreams of profits realistic. The USD/SGD may continue to move lower near-term but the speed of the decline is likely to reduce and begin to see cyclical trading develop again which includes slight reversals upwards. Conservative traders may want to use the slight moves upward which test perceived resistance to sell the USD/SGD.
Singapore Dollar Short-Term Outlook:
Current Resistance: 1.35890
Current Support: 1.35500
High Target: 1.36075
Low Target: 1.35090
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