USDSGD Weekly outlook for Singapore Dollar – 19th May 2022

Introduction

The geopolitical events in Europe continue to unfold with a new drama as Finland and Sweden show interest in joining NATO while Russia reacts to their decision. Best Singapore brokers continue to seek for a safe asset to invest in as international businesses close deals which will bring volatility into the market.

Singapore Fundamentals

Reports from APAC show that there is improvement in the COVID-19 situation the rise in geopolitical risk, financial market sentiments, and volatile energy are rocking the Asia economy as the Russian invasion of Ukraine continues to count more casualties on both sides.

The Singapore authorities and China expanded their financial cooperation to support post-COVID-19 recovery according to MAS (The Monetary Authority of Singapore). It will help the two counties to improve on the existing relationship in terms of collaboration, facilitating, and financing investment in support of a post-covid-19 recovery for the two countries.

US Fundamentals

Unemployment claims

The data report on unemployment is very important to the monetary policymakers because of the ripple effects it has on the labor market. Consumer spending has some level of correlation with the market and it is an indicator concerning the health of the economy.

The unemployment report indicates the numbers of persons who have officially filed for insurance for the very first time in the new week, the data affects the currency because a lower record signals a good economy.

This week’s Forecast is at 200K while previous data was 203K.

USDSGD Price Analysis

Monthly Outlook: Uptrend

Monthly Resistance 1.38000, 1.46688

Monthly Supports 1.33785, 1.31870

Singapore brokers who are on swing long are about to break out above the psychological zone on the monthly chart for the buyers to dominate the USDSGD pair. The 01 June 2021 bullish close indicated the objective of the traders with long-term goals from the support zone of 1.31870. 

If the price of the USDSGD pair can close above the 1.38000, we should expect the bullish momentum to increase as the buying pressure reaches the resistance level of 1.46688. a point where the COVID-19 pandemic increased its effects on the economy. 

Weekly 

Weekly Resistance Levels: 1.39857, 1.40000.

Weekly Support Levels: 1.37450, 1.36850, 1.35000.

The USDSGD pair remains bullish technically on the weekly chart as the swing is not broken. The previous week’s candle closed in a bullish shape after the price was rejected at the 1.38366 low by the buyers who had to take the price higher.

We may see the price of the USDSGD pair pull back because the trend has moved by 3.08% in favor of the bulls from the support level of 1.35672 to the high of 1.39857, the pair will be in a correction phase before the bullish run resumes.

Daily Outlook: Bearish

Daily Resistance Levels: 1.36880, 1.37200, 1.40000.

Daily Support Levels: 1.33625, 1.34100, 1.38360, 1.35022

On the daily chart, we can see that the market is going into a consolidation after the previous swing. A breakout above the resistance zone will likely lead to the continuation of an uptrend. The USDSGD pair closed above the previous resistance zone of 1.37420 which is acting as a support during the recent swing after the zone was retested. 

The bulls took the price up towards the resistance level of 1.40000 on the daily timeframe and made about 1.86% gain against the Bears from the support one of 1.37334.

The bullish run is slowed down after the bulls had profitable trading activities as of last trading week. For this trading week, the pair may see some corrections if the bullish momentum is lost. Singapore brokers who anticipate the trend to change around the resistance will wait for the confirmation of the reversal of the trend if the pair fails to breakout above the resistance level of 1.40000.

Bullish Scenario:

A bullish scenario is expected when we see the bulls overturn the resistance level into support by breaking out above the 1.40000 zone on the daily time frame.

Bearish Scenario:

A bearish scenario can happen around the daily resistance level of 1.38750 as the bullish momentum shows some levels of weakness. Sellers may open a short position to bring the price down.

USDSGD Conclusion

The Singapore Ministry of Health announced to the general public through the MTF (Multi-Ministry Task Force) the SMMs parameters, in line with measures to be taken to overcome another wave of covid-19. The streaming of Safe Management Measures is expected to cover group sizes, mask-wearing, workplace instructions, capacity limits, and safe distancing.

The price is around a resistance zone and we expect some resistance to the uptrend before a retest for a breakout and continuation of the trend or a complete reversal around the resistance zone.