Day two: our potential USD/SGD trade

I suggested that USD/SGD could fall from a key retracement level, and thus looked at short positions. 

With USD/SGD trading at 1.2680 at the time of writing, the falls seen overnight (now trading in 1.2623) have put the trade in the money.

Singapore inflation (released yesterday) came in just under expectations at 1.5%; however with the USD finding sellers across the market, we’ve seen good inflows into a number of emerging market currencies. The fact that the S&P 500 has printed a new high has clearly assisted risk sentiment and it’s also interesting to see that the 21-day moving average has crossed below the 50-day moving average, highlighting that momentum is shifting to the downside.

On the hourly chart the pair is oversold, so we could witness a bit of a bounce, but we are not seeing those conditions on the daily chart, so I will stay short this pair.

IG Charts

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