The rally in the Singapore dollar against its US counterpart this year doesn't seem to have ended in a near-term perspective, but the medium-term downtrend in the local dollar began two years ago is still intact, charts show.
The USD/SGD pair had moved off the 7-year high of 1.4538 hit last month, translating to a 2% gain in the Singapore currency since then, but the pair has still got several support levels to pass through before breaking the broad upward journey since mid-2014.
A break below the current support of the USD/SGD pair near 1.4150 can take it to 1.3950 (50% fibonacci break of the 6-month upward move of the pair to its December peak) without much struggle, but there is a stronger support near 1.3800 (38.2%), which comes in line with the 100-period moving average on a weekly chart.
The next important level on the downside of the pair is 1.3600 (23.6%), which also comes on the trend line, ahead of a retest of the June 2016 trough of 1.3312, which was a 1-year high for the Singdollar then.
Fundamental news from the island economy on Thursday (Jan 26) had last year's employment data which was negative for the local currency.
Singapore's yearly job growth slowed to a pace of 0.4% or an addition of 16,400 jobs in 2016 from the previous year's 0.9% rise or an addition of 32,000, the Labour Ministry said.
Analysts say that Singapore's employment generation will remain under pressure in 2017 or continue to soften dragged by sluggish domestic business conditions and uncertain US business climate after Trump coming to the Presidency, in addition to the slowdown in China.