Where USDSGD stands

Evening traders,

With the surge in appetite for risk a few weeks ago, the USD/SGD currency pair was affected as well – a move out of US dollars meant USDSGD broke through a strong support region at around 1.2400. Moving averages are well below the heavy 200-day MA. Bollinger bands were opened up as a result of the strong downward move too. The lasst few days produced a breather from the market (very much the same picture for other instruments). What this means is that I will be looking for short-term short set-ups.

In the larger scope of the USDSGD price action, USDSGD is at the bottom of a huge long-term downward channel. Also, I have to bear in mind the bollinger band’s lower band (200 days midband, 2.5 standard deviations). Since price is near the lower band – which was actually violated during the sell-down – I have to note that USDSGD is relatively oversold when looking at the long-term moving average and the 2.5 standard deviations “envelope”. If USDSGD does continue to go lower, then price will trade along the band, and I see that as a major trend that will defy the lower band’s existence temporarily.

In conclusion, trading set-ups betting on weakening USD are scattered on charts. All that is left is for triggers/catalysts. If we do not see that, then there should be a continued, healthy correction upwards for USD (current mid-term trend is weakening USD).

All analyses, recommendations, discussions and other information herein are published for general information. Readers should not rely solely on the information published on this blog and should seek independent financial advice prior to making any investment decision. The publisher accepts no liability for any loss whatsoever arising from any use of the information published herein.

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