USD/SGD Analysis 01/10: : Sideways Action (Chart)

(MENAFN- Daily Forex) The USD/SGD is near the 1.28900 vicinity in early trading this morning, less than one hour after the U.S government shutdown officially began. Trading action has been calm thus far as financial institutions maneuver.

The U.S government shutdown began a little less than one hour ago and the USD/SGD has shown some incremental selling until now. The currency pair is traversing near the 1.28900 level. Traders who have been paying attention to the news, knew that the U.S government was likely to shutter its door at midnight in the State due to the inability to get a funding gap agreement done.

Some speculators may have anticipated a rush into safe havens like the USD as the U.S government shutdown. However, what traders need to understand is that the event which is unfolding now, had been anticipated the past week. Trading in Forex and the USD/SGD had already priced in potentially nervous reactions. The USD/SGD was at 1.29520 last Thursday. Since then the USD/SGD has actually found a bearish trend.

Top Forex Brokers1 Get Started 74% of retail CFD accounts lose money 1.29000 as a Resistance Barometer

Financial institutions have dealt with U.S government shutdowns before. The broad markets do not cease, in fact they should function fluidly. The lack of U.S economic data today and the remainder of the U.S shutdown will not cause a massive reaction either. Financial institutions are essentially left to trade solely on their behavioral sentiment and outlooks.

If the USD/SGD shows an ability in the coming hours to not exceed the 1.28900 by too great a distance upwards and maintains the 1.29000 level as durable resistance, this may suggest that some large traders are actually leaning into more USD/SGD selling. The currency pair briefly touched the 1.27200 ratio on the 17^th of September during the U.S Fed's FOMC interest rate decision. Last Wednesday when nervousness started to creep into Forex and equities due to the shadow of the potential U.S government shutdown, the USD/SGD was near 28400 and Trying to Capture Opportunities

Financial institutions have been down this path before. Inexperienced traders likely have not been treated to the absence of the U.S government when trading – they should not be too scared.

EURUSD Chart by TradingView

• Nervousness in the broad markets exists because of a lack of clarity, but Forex including the USD/SGD now that the shutdown has started will likely only react violently if there is a sudden dose of loud noise.
• Day traders should remain calm and understand the USD/SGD will likely see rather normal price action in the near-term.
• Traders should not get overly ambitious.
• The USD/SGD may practice a consolidated cautious range today.
• Quick hitting trades that seek to take advantage of reversals may be attractive, downside temptations may prove attractive.
• Conservative traders may prefer to simply watch the USD/SGD near-term as the U.S government shutdown continues.

Singapore Dollar Short Term Outlook:

Current Resistance: 1.28925

Current Support: 1.28880

High Target: 1.29030

Low Target: 1.28750

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