Renowned investment managers, OCBC Frances Cheung and Christopher Wong, report that the USD/SGD pair has continued to decline, in line with the overall softness of the US dollar.
Anticipated Consolidation at Recent Lows Before US Jobs Data Release
After briefly dipping below the 1.30 mark to reach a low of 1.2992, the pair is currently trading below the key level. Daily momentum shows a mild bullish trend, although RSI has decreased. Market analysts predict that there may be a period of consolidation near the recent lows as investors await the upcoming US jobs data. Support is expected at 1.2960, with resistance levels at 1.3090 (21 DMA) and 1.3160 (23.6% Fibonacci retracement of the 2024 high to low).
Furthermore, the S$NEER is currently estimated to be approximately 1.92% above the model-implied mid-point, with the model suggesting a lower bound of 1.2990. Given the proximity of the S$NEER to its lower limit, there may be limited downside potential for the USD/SGD pair in the short term. However, if the broader US dollar weakens further, the implied lower bound for USD/SGD could decrease.
Analysis and Implications for Investors
In simpler terms, the USD/SGD pair has been on a downward trend due to a weaker US dollar. There is a possibility of the pair consolidating near recent lows before the release of US jobs data. Support is expected at 1.2960, while resistance levels are at 1.3090 and 1.3160. Investors should keep an eye on broader market movements, as a further decline in the US dollar could impact the USD/SGD pair. It is important to stay informed and consider these factors when making financial decisions.