USDSGD Is Approaching Important Resistance
Axi | Apr 28, 2017 14:08
Originally published by AxiTrader
I love trendlines.
If there was only one thing I was allowed to do on charts I would just draw trendlines. They are so simple and so powerful and they are where I always start my technical analysis on markets that I don't follow regularly.
Equally though, they are also a big part of my analytical framework on all my charts.
And recently I've been watching the basing of the USD/SGD rate since the march lows and the downtrend line from January's high that has been constraining it and potentially setting up for a big break higher.
What we see here is a great setup for a big trend reversal in USD/SGD if the downtrend line breaks and the price moves back above 1.40. That could signal a move toward the 38.2% retracement at 1.4150.
Interestingly if this downtrend breaks in USD/SGD it may signal a broader change in the recent weakness of the US dollar in index terms and across the board.
Here's the chart of the USD/SGD and US dollar index's relationship over the past year.
Naturally, where goes the US dollar so goes the Sing to a large extent. But a turn in USD/SGD might be a bigger signal for forex traders in other pairs.
The levels have to break. But I'll be watching USD/SGD as a bellwether for other markets.
Have a great day's trading.
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