USD/SGD weakened overnight as markets weighed hopes of de-escalation, and it was last seen at 1.2845. Daily chart signals showed bullish momentum easing, with RSI lower.
Technical patterns included a bearish engulfing candlestick, pointing to near-term downside pressure. Support was noted at 1.2810/1.2820, linked to the 21 and 100 DMAs.
Key Support Levels
Further support levels were set at 1.2780, the 38.2% Fibonacci retracement from the November high to the 2026 low. A break below would leave 1.2740, the 50 DMA, as the next level.
On the upside, resistance was placed at 1.29, the 61.8% Fibonacci level, and at 1.2940. Attention is also on the upcoming Monetary Authority of Singapore meeting.
All policy options were described as available ahead of the decision. One possible outcome mentioned was a steeper slope for the S$NEER policy band.
The USD/SGD pair has weakened, currently trading around 1.2845, as markets grow more optimistic about geopolitical de-escalation. Technical charts are showing that the previous upward trend is losing steam. This suggests a potential shift towards a period where the Singapore dollar strengthens.
Options Trade Ideas
We are closely watching the upcoming Monetary Authority of Singapore (MAS) meeting, with a growing belief they will steepen the S$NEER policy slope to strengthen the currency. This view is supported by recent data showing Singapore’s core inflation remained stubbornly high at 3.5% in February, keeping pressure on the central bank to act. This is a familiar pattern, as we saw similar hawkish leanings from the MAS throughout much of 2025 when inflation was a key concern.
At the same time, the US dollar itself is facing headwinds. The Federal Reserve’s recent shift to a more cautious tone has markets anticipating potential interest rate cuts later this year. This contrasts with the MAS’s likely tightening bias, creating a clear policy divergence that favors the Singapore dollar.
For derivative traders, this environment suggests considering put options on USD/SGD to profit from a potential drop. A break below the immediate support at 1.2810 could be a key trigger for such a move. The next significant targets to watch would be around the 1.2780 and 1.2740 levels.
Alternatively, selling call options with strike prices at or above the 1.2900 resistance level could be a viable strategy to collect premium. This approach benefits from the view that upward momentum is capped and the pair is unlikely to break through these higher levels. A bear call spread could also be used to define risk in this trade.
