SGD: Trading down close to some of the lowest ever levels seen for this currency pair

Nicole Elliott from Mizuho Corporate Bank at 01/13/10

Comment: Trading down close to some of the lowest ever levels seen for this currency pair, below one standard deviation from the long term mean at 1.7500, matching the May 1995 low at 1.3830 ahead of the record low at 1.3450 set in July 2008. December’s bounce is clearly corrective and may have already peaked (although a re-test of the 1.4100/1.4200 zone cannot be ruled out just yet). The rapidly descending weekly Ichimoku ‘cloud’ should maintain downside pressure during H1 2010, but expect a real tussle and nervous authorities when we get to the 1.3500/1.3600 area.

A weekly close above 1.4225 forces us to adjust.