This pair is fundamentally long, that is because turmoil in international markets along with pressure from the SGD's neighbor in China, might cause a selling pressure on the emerging market to face off the negative global trade effects, which is another play for currency wars, especially that Singapore mainly depends on global trade which is poised to fall along with slowing global growth and increasing uncertainties.
I usually trade medium term price action patterns. I also treat trading as a way of creating wealth and not a way of income, by that I avoid day trading. OK! so looking at the Weekly chart along with the "Line Break" candles, I identified major resistance and support areas that we should be aware of. The Daily 200 and 50 daily moving averages are trading below the pair price, and are also pointing upwards, giving us a bias to take on this long ride.
Since 2010 this pair has been trading in consolidation and only broke out in August of this year. The red bold dotted line shows the major break out area of the major resistance @ 2.1428. Prices tested that level in 2010 and was tested again in July,2014 however both times failed at breaking this area. Then prices fell to test the 1.9951 shown in the shadowed area and created a , rejecting to fall further. Then, In August prices finally pushed up and closed above that area adding to our bias on this pa
Now that prices broke out to the upside, they retraced to re-test the previous resistance which is now the new support @ 2.1428. I will take half of my position in the long side at this point and will add further positions to make a full trade after breaking above 2.2300. My target for this trade is 2.40, I usually set my stop loss to not lose more than 2-5% of my account value, depending on the pair's .
Thank you happy trading.