For now, however, the pair is attempting what seems to be a sound track towards the southern trend-line of the triangle. In case the pattern holds for now, the pair will make its way towards the lower trend-line at 1.4827 with a few interruptions on the way. In addition, a broken symmetrical triangle can be sketched along recent developments, which further implies that a plunge will follow.
Monthly Chart:
© Dukascopy Bank SA
Major levels still strong
The strong support levels established by all time lows, however, bring reasonable doubt into the assumption that the pair has decent downside potential, as several technical aspects of the market signal that it may not be ready for such action just yet.
The SWFX sentiment index shows a majority of traders being pessimistic when it comes to future developments of the pair, implying an upward movement, which is supported by the strong bullish signal sent by the 20-day and 100-day SMA crossover. If the pattern is broken on the upside, the upper trend line along with the 200-day SMA at 1.5302 will be overstepped, just before a rally towards the monthly R1 and upper Bollinger Band at 1.5379/83.
Weekly Chart:
© Dukascopy Bank SA
In order to actually see a break below the major resistance line, upcoming fundamental data releases, such as the Spanish Unemployment change and month-on-month PPI should contribute to further depreciation with bad news for the Euro zone or expansionary monetary policies. The Singapore Dollar will not experience any fundamental changes based on economic data releases in the nearest future.
Aggregate Technical Indicators:
© Dukascopy Bank SA