Singapore Dollar Faces Downside Risks as USD/SGD Trade Remains Rangebound

According to OCBC Bank strategists Sim Moh Siong and Christopher Wong, the Singapore Dollar (SGD) is facing near-term downside risks against the US Dollar. The USD/SGD pair traded slightly firmer after resilient US data halted the US Dollar's downside pressure.

The strategists note that despite this brief uptick, the pair remains subdued and rangebound ahead of Chair Warsh's Jackson Hole speech on Friday at 10pm SGT. Daily momentum for USD/SGD is still mildly bearish, but the Relative Strength Index (RSI) is turning higher from near-oversold conditions.

This leaves room for some near-term upside in USD/SGD and therefore downside risks for the SGD. Resistance levels are seen at 1.2740 and 1.2780/90, with support at 1.2680 and 1.2650.