Singapore Dollar: Further losses against US Dollar toward 1.2960 – UOB

FXStreet Insights Team FXStreet

UOB’s Quek Ser Leang and Lee Sue Ann highlight that USD/SGD surged past 1.29 after a blowout US nonfarm payrolls report, with the S$NEER still trading well above its mid-point. In the short term, they see scope for a test of the year-to-date high near 1.2930, while on a 1–3 week horizon, the focus shifts to resistance at 1.2960, provided support at 1.2830/1.2855 holds.

Upside bias with key resistance levels

"24-HOUR VIEW: After our expectation for USD to test 1.2855 did not materialise last Thursday, we highlighted on Friday that “there remains a chance for USD to test 1.2855.” We also highlighted that “a breach of 1.2855 is not ruled out, but a continued rise above this level appears unlikely,” and “the next major resistance at 1.2890 is also unlikely to come into view.” The subsequent price movements did not unfold as expected. While USD subsequently rose slightly above 1.2855, it retreated to a low of 1.2828, and then in a sudden move during the early NY session, jumped to a high of 1.2913. Strong momentum suggests USD could test the year-to-date high, near 1.2930. The next resistance at 1.2960 is likely out of reach for now. To keep the momentum going, USD must hold above 1.2870."

"1-3 WEEKS VIEW: Last Tuesday (02 Jun, spot at 1.2785), we highlighted that “there has been a slight increase in upward momentum, but for a continued rise, USD must first close above 1.2810.” After USD rose and closed at 1.2841, in our most recent narrative from last Thursday (04 Jun, spot at 1.2835), we highlighted that “the price action suggests USD could rise further to the significant resistance at 1.2855.” We added, “looking ahead, should USD break above 1.2855, the focus will shift to another significant resistance at 1.2890.” We did not expect USD to lift off on Friday and surge above 1.2890, as it printed a high of 1.2913. The sharp increase in upward momentum is likely to lead to further USD strength. The level to watch is 1.2960. We will maintain our positive USD view as long as it holds above 1.2830 (‘strong support’ level was at 1.2800 last Friday). In the near-term, 1.2855 is already a firm support level."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

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FXStreet Insights Team

FXStreet

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