US Dollar Forecast: USD/SGD Uptrend at Risk as IDR Eyes Breakout
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USD/SGD, USD/IDR, Singapore Dollar, Indonesian Rupiah - Talking Points
- US Dollar could reverse dominant uptrend versus SGD
- But USD/SGD fading momentum warns of a turn higher
- Indonesian Rupiah still awaiting key breakouts vs USD
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Singapore Dollar Technical Outlook
Against the US Dollar, the Singapore Dollar is sitting at a key rising support channel from the beginning of 2018 – red lines below. As USD/SGD pressures this psychological area, the dominant uptrend that has prevailed for the past roughly two years is at risk. A daily close under could pave the way for a reversal of this lasting dynamic, especially if the US and China continue inching closer towards a trade deal.
USD/SGD Weekly Chart
Zooming in to the daily chart, USD/SGD is experiencing positive RSI divergence as it attempts a breakout lower. This is a signal of fading momentum to the downside. At times, this can precede a turn higher or translate into consolidation. The latter has been the prevailing outcome as of late. A continuation of the near-term downtrend would entail taking out the June lows (1.3513 – 1.3521).
Otherwise, overturning the downtrend would place the focus on a potential falling resistance line from late August – blue line below. Getting there also involves taking out the psychological barrier between 1.3609 and 1.3624. A daily close above this area could open the door to revisiting highs from October which range from 1.3836 to 1.3879.
USD/SGD Daily Chart
USD/SGD Charts Created in TradingView
Indonesian Rupiah Technical Outlook
Meanwhile the Indonesian Rupiah continues to consolidate between key psychological barriers. On the USD/IDR weekly chart below, favoring the downtrend is falling resistance from May – red line. Resuming declines involves taking out horizontal support which is a range between 1.3848 to 13923. That may open the door to testing 13705 which is the March 2018 low.
USD/IDR Daily Chart
USD/IDR Chart Created in TradingView
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--- 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.