USD/SGD 1H Chart: Correction expected after surge

Source: Dukascopy Bank SA

Indicator 4H 1D 1W
MACD (12; 26; 9) Buy Buy Buy
RSI (14) Sell Neutral Neutral
Stochastic (5; 3) Sell Sell Neutral
Alligator (13; 8; 5) Buy Buy Buy
SAR (0.02; 0.2) Buy Buy Buy
Aggregate

Following a three-week period of consolidation, the US Dollar finally managed to pick up momentum against the Singapore Dollar on Thursday and consequently advance 1.10% within two trading sessions. This move happened after the pair reached the upper boundary of two different-scale channels. 

By mid-Monday, the Greenback had reached the upper boundary of the junior channel and the 50.00% Fibonacci retracement near 1.3780. This short-term appreciation has pushed technical indicators in the overbought territory. This means that a correction south is likely to occur soon. 

Even if bulls still move the rate higher during the following hours, the bearish sentiment should take over the market later in the week and target the 55-, 100– and 200-period (4H) SMAs at 1.3650. The bottom boundary of the senior channel is likewise located there.

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