We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
GBP/USD
Mixed
USD/JPY
Bearish
Gold
Mixed
Oil - US Crude
Mixed
Bitcoin
Bearish
More View more
Real Time News
  • The #Nasdaq 100 and S&P 500 opened significantly lower on Monday on the back of #coronavirus fears as the #VIX jumped to its highest level since early October. Get your market update from @PeterHanksFX here: https://t.co/WpXDAidw4C https://t.co/MCd1g1Ghdv
  • Today's headlines: "<Insert market name here> collapsed/surged due to fears over the spread of the cononavirus" Nevermind that there has been warning signs about growth, dwindling rates of return, flagging monetary policy effectiveness, liquidity gaps, etc.
  • Forex Update: As of 21:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: 0.34% 🇨🇭CHF: 0.17% 🇪🇺EUR: -0.05% 🇨🇦CAD: -0.35% 🇦🇺AUD: -0.95% 🇳🇿NZD: -0.96% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/33EP1DeeuH
  • Commodities Update: As of 21:00, these are your best and worst performers based on the London trading schedule: Gold: 0.69% Silver: -0.10% Oil - US Crude: -0.74% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/J4wTEmtAXA
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.56%, while traders in US 500 are at opposite extremes with 67.46%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/XboitD6oGi
  • The $AUD came into the New Year clinging to a very visible bullish trend. While the currency had a rather rough first nine months of last year. Get your AUD/USD technical analysis from @JStanleyFX here: https://t.co/HrLlgqvibu https://t.co/efoZc6VjGC
  • The US #StockMarket is on pace to close markedly lower to start the week with less than 30-minutes left in today's #trading session as #Coronavirus fears roil Wall Street S&P 500: -1.46% Dow Jones: -1.45% Nasdaq: -1.80% Russell 2K: -0.73% VIX: +22.25% $SPX $DJI $NDX $RUT $VIX
  • #Bitcoin Daily Pivot Points: S3: 7768.5 S2: 8055.53 S1: 8177.32 P: 8342.56 R1: 8464.35 R2: 8629.59 R3: 8916.62
  • The #Dow Jones remains elevated as tech and defensive sectors underpin the index. However, we see caution in chasing the market higher amid rising risks of a potential correction. Get your market update from @JMcQueenFX here:https://t.co/3klcZ6CHpe https://t.co/3xvxNNWb2O
  • RT @MarketWatch: Economic hit from coronavirus likely to be short lived, but it’s still ‘a little scary, frankly’ https://t.co/NyB3DCRpGS
US Dollar Uptrend on SGD Reinforced by Singapore PMI Contraction

US Dollar Uptrend on SGD Reinforced by Singapore PMI Contraction

2019-10-03 02:00:00
Daniel Dubrovsky, Analyst
Share:

Singapore Dollar, USD/SGD, Singapore PMI - Talking Points

  • US Dollar may gain vs SGD as Singapore PMI contracts twice in a row
  • Trade War fears may fuel demand for havens as new front opens in EU
  • USD/SGD uptrend reinforced by July rising support, resistance eyed

Trade all the major global economic data live as it populates in the economic calendar and follow the live coverage for key events listed in the DailyFX Webinars. We’d love to have you along.

US Dollar May Gain Versus Singapore Dollar After Local PMI Data Disappoints

The US Dollar may rise against the Singapore Dollar down the road after PMI data underpinned rising bets of easing from the Monetary Authority of Singapore. For these data sets, a reading below 50 indicates contraction and vice versa. IHS Markit Singapore PMI - whole economy - clocked in at 48.3 in September which was softer than the 48.7 outcome in August.

Not only did this mean the second consecutive contraction in economic activity, but it was also the lowest outcome since August 2012 (over 7 years ago). On the first chart below, the decline in activity has been coinciding with weakness in global manufacturing PMI. We also recently saw fading output from a similar measurement in the United States (10-year low) as China’s economy has slowed to its weakest in 30 years.

These surveys have been highlighting the US-China trade war as a key factor in fading output as trade activity slows. Singapore’s economy is heavily reliant on external activity, and this has also translated into reductions of growth forecasts for this year and beyond. Now according surveys from Bloomberg, local GDP is expected to clock in at 0.7 percent y/y this year. This is down from a 2.2% forecast from June.

This has translated into rising expectations that the Monetary Authority of Singapore (MAS) could ease policy at its semi-annual meeting later this month. Unlike most central banks, this would mean a shift towards targeting depreciation for the SGD. Meanwhile, the US Dollar could benefit if rising trade war fears induce demand for safe havens. This is as another front opens up across the Atlantic Ocean.

Read my Singapore Dollar Overview to Learn More About how the MAS manages monetary policy

Singapore PMI Follows Drop in Global Manufacturing PMI

US Dollar Uptrend on SGD Reinforced by Singapore PMI Contraction

USD/SGD Technical Analysis

Taking a look at USD/SGD daily chart, the pair has been in a near-term uptrend since finding a bottom around 1.3725 in September. Zooming further out, we can see that its rise has been reinforced by ascending support from July – red line below. After taking out the psychological barrier between 1.3808 – 1.3836, this has opened the door to testing August highs. A close under rising support increases the odds of a bearish reversal.

USD/SGD Daily Chart

US Dollar Uptrend on SGD Reinforced by Singapore PMI Contraction

Chart Created in TradingView

Singapore Dollar Trading Resources

--- Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.