Technical and fundamental Forex traders are likely having a loud debate now regarding the daily results in the currency markets. The USD/SGD is trading near the 1.34475 ratio as of this writing which is near its one-week high. The last time the USD/SGD was near its current values was on the 10th of July. Last Tuesday the USD/SGD was being traded around the 1.33450 ratio before it started to climb higher. In the past handful of days the USD/SGD has experienced rather fast price velocity making its results rather productive for speculators on the correct side of direction, and likely an expensive losing wager for those on the wrong side of the trading action.
Risk-averse price action in Forex has sparked a stronger USD across the broad markets and the USD/SGD has seen bullish momentum build. There are also concerns the U.S. Federal Reserve may have to remain more aggressive than many financial institutions had anticipated only a few weeks ago. U.S. economic data has been mixed, but traces of inflation worries continue to cause some buying action for the USD. However, this Thursday the U.S. will publish CPI data and if this result is weaker than expected, perhaps some selling of the USD/SGD could be sparked.
Looking for Short-Term Trends in the USD/SGD has Been Difficult
Choosing direction in the USD/SGD for wagers on the direction has proven difficult the past week. Perspectives regarding short-term support and resistance have consistently been proven to be rather hard for traders recently. Resistance levels may be appealing at the current price level of the USD/SGD for speculators willing to wager against the prevailing upwards short-term movement. The 1.34500 level may be viewed as an important psychological level.
- In early trading today the USD/SGD has broken through the 1.34500 level a couple of times but has not been able to sustain prices above this level yet.
- However, if the resistance level fails to hold back bullish sentiment, a reminder that trading in early July certainly explored the 1.34900 to 1.35300 ratios rather comfortably is valid.
China CPI Numbers Tomorrow and U.S Inflation Data on Thursday Could Impact USD/SGD
Fundamental traders may be awaiting tomorrow’s CPI numbers from China and the U.S. data on Thursday. The results upwards in the USD/SGD have likely caught many traders by surprise, but risk appetite for the moment appears to be fragile and this could be feeding into a stronger USD.
Day traders need to be cautious and practice solid risk management in order to avoid the volatile results the currency pair has produced. Quick hitting targets using take-profit orders should be practiced. The near term may produce consolidated choppy trading as financial institutions await the U.S Consumer Price Index results on Thursday.
Singapore Dollar Short-Term Outlook:
Current Resistance: 1.34525
Current Support: 1.34420
High Target: 1.34760
Low Target: 1.33910
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