Singapore Dollar: Strong Dollar keeps pair supported – OCBC
OCBC strategist Christopher Wong highlights that Singapore Dollar (SGD) remains largely driven by the broader Dollar story after the FOMC, given its high sensitivity to USD moves.
In a report by OCBC strategist Christopher Wong, it is noted that the Singapore Dollar (SGD) remains influenced by the overall Dollar situation following the Federal Open Market Committee (FOMC) meeting. Wong advises maintaining a cautious stance on SGD if the US Dollar Index (DXY) and front-end US yields continue to rise. He mentions that weaker US economic data, labor market or inflation figures could potentially lead to a decrease in USD/SGD.
The Federal Reserve's shift towards a more hawkish stance may provide temporary support for USD/SGD in the near term, but this does not alter its sensitivity to US data. If incoming US economic data, labor market or inflation readings start to weaken and rate expectations are adjusted downwards, SGD could face another decline. The bullish daily momentum is observed, but the Relative Strength Index (RSI) is nearing overbought territory.
A potential hanging man pattern is identified, with the 50-day moving average cutting the 200-day moving average to the downside. Resistance levels are indicated at 1.2790 (50% Fibonacci retracement of 2026 low to high) and 1.2810 (50, 100, 200 DMAs). The next significant level is at 1.2840 (38.2% Fibonacci). Support levels are found at 1.2740 (61.8% Fibonacci), 1.27 (21 DMA).
The article also mentions that AUD/USD is recovering and USD/JPY is experiencing losses ahead of the Bank of Japan meeting, while gold is climbing and approaching a new weekly high.
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