USD/SGD Capped by Key Resistance at 1.2705

According to UOB strategists Quek Ser Leang and Lee Sue Ann, the Singapore Dollar (SGD) has been capped by key resistance at 1.2705 against the US Dollar (USD). The pair has rebounded strongly, but short-term momentum points to higher gains being limited by this resistance level.

The strategists now see an upside bias for USD/SGD over the next one to three weeks, provided the pair holds above 1.2640 and the SGD Nominal Effective Exchange Rate (NEER) remains comfortably above its mid-point.

Looking at the short-term view, UOB expects USD to trade with an upside bias from here but must clearly break above 1.2705 before a sustained rise is likely. To sustain momentum, USD must hold above 'strong support' level, now at 1.2640.