Day traders able to follow momentum in the broad Forex market since the start of this week have been able to witness dynamic price action via shifting winds. Monday’s trading in the USD/SGD, and other major currencies teamed against the USD, highlighted the turbulence which fills the air. Sentiment shifts have been violent, but in some ways they have been predictable as risk adverse conditions have eroded and now – risk appetite makes itself known.
A high of 1.27870 thereabouts on Monday’s opening in the USD/SGD as fears cascaded early after the failed negotiations between the U.S and Iran, suddenly began to shift lower. The realization that even though the negotiation had not produced an agreement, that the ceasefire was still being adhered to started to soothe financial institutions’ nerves. Nervous conditions in Asian equity indices and currencies started to become more calm. By late on Monday the USD/SGD was near the 1.27250 realm.
Risk Appetite Finds Sustained Power
Yesterday’s trading in the USD/SGD continued to exhibit that broad market sentiment continued to believe tranquility would dominate. The USD/SGD sustained its lower territory and as of this morning the currency pair is traversing near the 1.27128 ratio and showing a tendency to push lower.
The 1.27100 mark will certainly be a target of traders and if this support level proves vulnerable, a retest of yesterday’s lows around the 1.27000 mark is likely going to become a focal point. The USD/SGD was trading near 1.26500 on the 27th of February and before that date was in lower terrain. This knowledge may show where financial institutions may be looking for traction if risk appetite continues to remain strong. Conditions remain fast and price velocity must be looked at cautiously.
Over Ambitious Targets and Near-Term Wagers
The USD/SGD has certainly traded lower compared to its current values. However, day traders should remain realistic if they are pursuing lower ground.
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The use of take profit orders are encouraged, along with stop loss usage because the saga from the Middle East could change in the blink of an eye.
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However, in the meantime barometers such as global indices via equities, stable and lower Crude Oil costs via future markets, and broad Forex conditions with a weaker USD centric viewpoint are helping generate a bearish USD/SGD.
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Looking for lower realms in the USD/SGD is attractive near-term, but day traders need to remain focused on technical moves that may spark some intraday reversals higher.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.27160
Current Support: 1.27110
High Target: 1.27225
Low Target: 1.26980
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.
