Moves Towards Key Support

Singapore dollar finished the European/US session stronger, USD/SGD finishing the day some 30 pips lower, the pair last changes hands at 1.3449. Familiar technical levels are in play, resistance is seen at last week's high of 1.3495, beyond which is the 2021 high at 1.3531. Support is seen at 1.3444, a 23.6% retracement level, while strong support is seen at 1.3391, a 38.2% retracement level that has held since early March. SGD is supported by higher domestic yields, the benchmark 10-year yield is over 90bps higher since the start of 2021.

• Maybank sees SGD strength thanks to positive procyclical response and rapid pace of vaccine rollouts. "In Mar, USD/SGD broke out of the downward trend channel which has been intact since last Mar. But bullish momentum on daily chart has dissipated while RSI is also not seeing a clear bias. Chance for spikes in the pair may be lower for now. On the weekly chart, 50-WMA just cut the 100-WMA to the downside, which could be a longer-term bearish signal. Still prefer to lean against strength. Resistance at 1.3480, 1.3520 (200-DMA), 1.3730 (38.2% fibo retracement from Mar 2020 high to Feb 2021 low). Support at 1.3430 (21-DMA), 1.3340 (100-DMA)"
• There were reports in The Straits Times that China and Singapore could allow travel to resume if there is a system that mutually recognises health certification and personal information exchange, however there is no timeline for the plan yet. In June 2020 the two countries relaxed travel restrictions for business travelers. The ministry of health reported earlier that Singapore has administered the first vaccine to 16.6% of the population.