USDSGD Technical Analysis for Singapore Brokers
Contents
Introduction
Last week’s bullish close and exit of the oversold area by the SG30SGD confirms an increase in demand on all Singapore brokers, and consequently, growth in the economy.
Also, the Senate stimulus package worth about $2 trillion by Feds focused on preventing a market crash that is similar to that in 2008, now draws attention to U.S stocks.
Below, we analyze the chart patterns that suggest the likely direction of the USDSGD, read on.
Singapore CPI
This plays an important part in recognizing the variations in purchasing sentiment and inflation in Singapore.
The Index measures changes in the prices consumers are willing to pay out for a basket of goods and services. The CPI draws its data from the consumer’s viewpoint.
A reading higher than anticipated means bullish for the currency. In contrast, a lower than expected reading means bearish for the Singapore dollar.
Data released most recently on March 23 suggests that a bearish sentiment is imminent for the SGD as the forecast reading is 0.4%, previous reading read 0.8%, meanwhile the actual reading is valued at 0.3%.
U.S. Core Consumer Price Index (CPI)
In the U.S, the CPI is an evaluation of the shifts in the price of goods and services. This evaluation excludes and food items.
The Core Consumer Price Index considers the perspective of the consumer when measuring the price change. The index is a major way to determine changes in consumer purchasing sentiment and inflation.
A reading higher than anticipated means bullish for the currency. In contrast, a reading lower than expected means bearish for the U.S. dollar.
Data released most recently on April 10 suggests that a bearish sentiment is imminent for the USD as the forecast reading is 0.1%, previous reading read 0.2%, and actual valued at -0.1%.
As the death toll from the coronavirus covid-19 pandemic increase, the U.S job markets sees a huge slump, with high volatility across U.S stocks. The stock market is currently witnessing a pullback. Only time will tell if the move can be sustained.
USDSGD Technical Analysis
USDSGD Long term Outlook: Bullish
Monthly Chart
Resistance: 1.46470, 1.41790, 1.32854, 1.39422
Support: 1.34450
After a bullish price close above a critical bearish divergence high, the USDSGD starts to show signs of slowing in momentum and perhaps another bearish divergence setup.
Let’s take to the lower weekly time frame for a clearer view to enable us understand the underlying patterns that may lead to a price hike or slump of the foreign exchange.
Weekly Chart
Resistance: 1.34876, 1.39422, 1.46470
Support: 1.38616, 1.42083, 1.37587, 1.34450
From the above weekly chart, a breakdown of hidden bullish support 1.42083 confirms a regular bearish divergence pattern and an exit of overbought area. This here is a high probability signal to short sell the USDSGD into the coming week.
However, the bulls may want to first establish a high candle wick before resuming the downward decline. We suggest you be on the lookout for such setups going forward.
USDSGD Medium Term Outlook: Bullish
Daily Chart
Resistance: 1.40877, 1.46470
Support: 1.34450, 1.37587, 1.42494, 1.35682, 1.39781
Trading in the oversold area and around the MA-50 support, the USD vs. SGD shows bearish momentum. However, later bullish reversal patterns may suggest an end to the price retrace.
H4 Chart
Resistance: 1.4647, 1.44844, 1.44193, 1.45138, 1.42965
Support: 1.42586, 1.43558, 1.44691, 1.42083, 1.4565
Above on the 4hour chart, the USDSGD resumes the bearish trend after a second regular bearish divergence setup followed by a breakdown of the 1.43558 support on 05 April 2020 at 16:00.
Subsequently, on 07 April 2020, 20:00, the bears again broke below another support zone, send the price deeper into the oversold territory.
Conclusion
A slump in the USD Index, and closing bearish last week justifies the increase in demand for the Singapore dollar.
This week, however, we expect a rise in the USD Index, so traders should pay attention to risk management while holding short positions on the USDSGD.
I've been a professional trader for over 5 years.
Currently I work as forex analyst for different investment companies.
- EURUSDWeekly outlook – 7th January 2022 - January 7, 2022
- BTCUSD – Weekly outlook for Bitcoin Price – 23rd December 2021 - December 24, 2021
- USDSGDWeekly outlook for Singapore Dollar – 17th Dec 2021 - December 17, 2021
