After several days of upward momentum, The US Dollar has been moving sideways against the Ringgit for the last 4 days and it is now traded at 4.2305. It seems to be ready to initiate a corrective downward movement at any moment. The macroeconomic agenda has been bringing mixed data on the US economy. Last week’s Initial Jobless Claims data (released on July 22) came in higher than expected. However, the Consumer Confidence indicator, released yesterday, brought in a higher-than-expected number, which could be good for the Dollar. Due to these mixed numbers, the dollar has remained sideways, and investors are waiting for any signal coming from the Fed to break the indecisive sentiment. From a technical point of view, the USDMYR could drop as low as 4.1750, where it may encounter some buying pressure.
The Singapore dollar has been in an uptrend against the Japanese Yen since late October 2020, when it went from 76.22 to 83.15. In the last few days, the SGDJPY has made a major retracement and is now trading at 80.66. This pullback is normal, as after long periods of rally, investors tend to take profits, which causes the pullback. Japan Services Purchasing Managers’ Index (PMI) data, released on Monday, shows a slight weakening of the Japanese economy from the perspective of purchasing managers. Unemployment data, which will be released on Friday, may confirm or not this view on the JPY. From a technical point of view, the SGDJPY is close to the 200-period moving average, which is an important trending indicator and can act as a support. If there is enough buying pressure, the SGDJPY may resume the uptrend and go for the 83.00 level in the coming days.
