(MENAFN- Daily Forex)
As the Forex markets began trading this morning, the USD has continued to be a source of nervousness. Results in the USD/SGD clearly show the currency pair near its highs, the reversal to the current 1.35200 vicinity will not let those who have been betting on bearish conditions to become sustained grow confident quite yet regarding a trend lower that can be maintained. A high earlier this morning in the USD/SGD near 1.35400 touched values last seen in November of 2023.
Financial institutions returning after the long holiday weekend are certain to increase volatility in Forex and the USD/SGD will not be immune. Nervousness pervades the USD outlook and this is having an effect on all major currency pairs . The ability of the USD/SGD to climb to a new mid-term high this morning, while sustaining yesterday's power drive upwards, is a warning sign for all speculators to be careful Reserve Outlook and Coming U.S Data are in the Mix
While most financial institutions were closed yesterday throughout Europe, the U.S did release a better than expected ISM Manufacturing PMI reading. This data continued to highlight the U.S economy remains rather strong and is putting the Federal Reserve in a difficult position. The outlook of interest rat e cuts from the Fed is seemingly becoming cloudier. This week the U.S will release a large amount of employment data which will affect the USD/SGD.
While many traders of the USD/SGD may believe the currency pair is overbought, the danger of fighting the trend upwards could become expensive for speculators. The notion the USD/SGD will have to reverse lower at some point is likely true, but timeframes remain questionable because U.S data continues to highlight the potential for the Fed to remain conservative. If the U.S jobs numbers surprise with better hiring this week, this would not help USD bearish viewpoints .
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The USD/SGD is touching values not seen in nearly six months. The USD/SGD did trade at higher values in November 2023 compared to the current price action . While it may seem 'impossible' to some the currency pair could gain further ground upwards, traders need to understand nervous financial institutions may remain reactive in the near-term. The 1.35350 level should be watched as resistance today, if it is penetrated and prices remain above this level, the USD/SGD could explore higher values.
The selloff which has occurred in the USD/SGD the past couple of hours is intriguing; support ratios near the 1.35150 should be watched. A move below this could put the 1.35000 level into play as a target. Traders should be careful today as full volumes return to Forex and financial institutions seek equilibrium.
Singapore Dollar Short Term Outlook:
Current Resistance: 1.35325
Current Support: 1.35155
High Target: 1.35460
Low Target: 1.34990
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