Forex Market: USD/SGD trading forecast for Monday

Friday’s trade saw USD/SGD within the range of 1.2957-1.3019. The pair closed at 1.2998, losing 0.04% on a daily basis, while gaining 0.19% for the whole week.

Fundamentals

United States

Services PMI data by Markit

Activity in the US sector of services was probably little changed in November, with the corresponding preliminary Purchasing Managers Index coming in at a reading of 56.9. If so, this would be the lowest index reading since April, when the final value was reported at 55.0. In September the final seasonally adjusted PMI stood at 57.1, down from a preliminary value of 57.3. The PMI is based on data collected from a representative panel of more than 400 private sector companies, which encompasses industries such as transport and communication, financial intermediaries, business and personal services, computing & IT and hotels and restaurants. Values above the key level of 50.0 indicate optimism (expanding activity). Lower-than-expected PMI readings would mount selling pressure on the US dollar. The preliminary data by Markit Economics is due out at 14:45 GMT on Monday.

Singapore

Consumer Price Index (CPI)

Annualized consumer inflation in Singapore probably remained at 0.6% in October, according to market expectations, matching the rate in September and also being the lowest since February. The annual rate has been slowing down since May, when inflation was reported at 2.7%. In September the CPI was influenced by a smaller increase in cost of services and a drop in accommodation cost.

Cost of services slowed to 1.7% year-on-year in September from 2.1% in the preceding month, a result mostly from the moderation in the increase in medical and dental treatment fees to 2.4% during the month. Accommodation cost dropped 0.6% year-on-year in September, extending a 0.2% decline in the previous month, due to the soft housing rental market. Food inflation rose to 3.0% in September from 2.9% in August, mostly due to a sharper increase in prices of prepared meals, according to the report by Singapores Ministry of Trade and Industry.

In case the CPI slowed down more than anticipated, this would have a bearish effect on the local currency. The official CPI data is due out at 7:00 GMT on Monday.

Pivot Points

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 1.2991. In case USD/SGD manages to breach the first resistance level at 1.3026, it will probably continue up to test 1.3053. In case the second key resistance is broken, the pair will probably attempt to advance to 1.3088.

If USD/SGD manages to breach the first key support at 1.2964, it will probably continue to slide and test 1.2929. With this second key support broken, the movement to the downside will probably continue to 1.2902.

The mid-Pivot levels for Monday are as follows: M1 – 1.2916, M2 – 1.2947, M3 – 1.2978, M4 – 1.3009, M5 – 1.3040, M6 – 1.3071.

In weekly terms, the central pivot point is at 1.3010. The three key resistance levels are as follows: R1 – 1.3087, R2 – 1.3175, R3 – 1.3252. The three key support levels are: S1 – 1.2922, S2 – 1.2845, S3 – 1.2757.