The US dollar against the Singapore dollar declined to a level of 1.2724 yesterday and is currently trading near the 1.2700 level. The pair has fallen by about 1% since the beginning of the year.
Recent economic data in Singapore indicate a degree of resilience in the Singaporean dollar, as:
- Industrial production on a monthly basis rose by 4.7%, a figure higher than the previous reading of -1.2%.
• The Consumer Price Index on a yearly basis increased by 1.8%, a figure higher than the previous reading of 1.2%.
• The trade balance in March recorded a surplus of SGD 11.212 billion, higher than the previous reading of SGD 4.537 billion.
• Singapore’s foreign exchange reserves increased to USD 419.2 billion in March, higher than the previous reading of USD 416.1 billion.
It is also worth noting that an additional factor has supported the positive momentum of the Singapore dollar, namely the weakness of the US dollar against most foreign currencies, particularly emerging market currencies. The US Dollar Index is currently trading near the 98 level, down about 0.50% since the beginning of the year, amid uncertainty surrounding the developments of negotiations and the ongoing conflict in the Middle East, as well as the continued closure of the Strait of Hormuz.
From a technical perspective, the Relative Strength Index (RSI) is currently at 49 points, approaching the oversold territory, indicating negative momentum for the USD/SGD pair. Meanwhile, the MACD indicator shows the MACD line trading below the signal line, confirming the continuation of bearish momentum for the pair.
In terms of support and resistance levels, if the pair breaks the pivot level at 1.2769, it may move to test the following support levels at 1.2763, 1.2754, and 1.2748. On the other hand, if the pair moves above the pivot level, it may target the resistance levels at 1.2778, 1.2784, and 1.2793.
Please note that this analysis is provided for informational purposes only and should not be considered as investment advice. All trading involves risk.
