Good morning Traders! One of the strongest currencies against the US dollar in the last couple of month was the Singaporean dollar.
After four months of steady selling pressure, the strong support level of around the round number of 1.30 was in sight. The buyers have come back to defend this level, and in the process, broke the longstanding downtrend on the Daily chart. With the price being very over extended from it’s moving averages, both on the Weekly and the Monthly charts, the recent buying action can be seen as a pullback to release some of the very strong selling pressure.
The level of 1.34 may be considered as the next level of resistance as it had multiple precise touches in the past. (It is also a round number). With the weekly in an established downtrend, drawing the Fibonacci retracement of the latest move has the 61.8% retracement clustering very nicely with the 1.34 level. And if and when the market will pullback into this level, price action will also be back in the area of it’s Moving Averages.
As always, I’ll be looking at the lower timeframes for signs that the pullback is over, and the sellers are ready to take control once again.