United Overseas Bank’s Quek Ser Leang has highlighted that the USD/SGD currency pair is experiencing near-term pressure, with support levels identified at 1.2760, 1.2660, and 1.2586, while resistance is capped by the 55-week EMA around 1.2940 [1]. As of early March, USD/SGD broke above a minor declining weekly trendline near 1.2755, suggesting that the late-January low of 1.2586 may represent a near-term bottom [1]. The breach of this trendline, coupled with a weekly slow stochastic indicator turning higher from oversold territory, points to a recovery bias for USD/SGD in the second quarter, although a major reversal is not expected at this stage [1].
Last week, USD/SGD moved above the major declining weekly trendline resistance, and two days ago, it reached 1.2929, approaching the 55-week EMA at 1.2940, before experiencing a sudden decline [1]. Despite fading upward momentum, a positive weekly MACD suggests it is premature to call for a sustained move lower [1]. The minor rising weekly trendline at 1.2760 is seen as immediate support, and while a break below this level is possible, the support at 1.2660 is unlikely to be threatened unless downward momentum increases [1]. The likelihood of USD/SGD breaking below the late-January low of 1.2586 is considered slim for now [1].
On the upside, resistance remains strong at the 55-week EMA (1.2939), and any recovery is expected to face significant hurdles at 1.2900 and 1.2950 [1]. For the anticipated recovery to materialize, USD/SGD must hold above the 1.2586 low [1].
CONCLUSION
UOB’s technical analysis suggests that while USD/SGD is under near-term pressure, the broader outlook favors a recovery in the second quarter, provided key support levels hold. Resistance at the 55-week EMA and fading momentum may limit upside potential, but a sustained move lower appears unlikely at this stage.